Study On Incentive And Coordination For The Players In A Firm Based On Fairness Preference

During the era of the rapid development, society as a whole business model is also experiencing earth-shaking changes. And a major change is the emphasis on human resources. How to play the individual economic initiative to make people create the largest output, this is of great practical significance. One cannot be ignored is the business incentive problem.Incentives on traditional enterprises are built on the basis of fully rational economic individuals. They seek to maximize personal benefits. However, in recent years, some researchers began to focus on the economy of individual irrational factors, which assumes economic agents have some fairness preference psychology. For example, there is a saying that is tooth for a tooth. This can manifest as jealousy particular preference, preference sympathy, pride preferences. This paper is a study on the economy of individual psychological preference fair decision business process in which individual economic impact.The article first analyzes the game of manufacturers and retailers. This paper studies the manufacturers and retailers who are having their best strategy when facing psychological fairness preference. Then we study the situation which introduces a fairness preference when psychological comparative analysis. And we draw some inspiration management. Studies have shown that retailers envy preferences do not affect the level of self-effort, but will affect the manufacturer’s wholesale price, profit and their own profits. Manufacturer sympathy Preference will lower their wholesale prices and profits, and the retailer will increase the level of effort and profits. Manufacturer envy preferences will reduce profits and retailer’s profits, and will raise wholesale prices, efforts and will reduce the level of retailers.Secondly, we study the game between principal and agent. We suppose the agent has a preference jealousy and pride preferences. We studied the incentive problem in both cases and how to manage the payment of wages and performance incentives. Studies have shown that when the company gets high income, the shareholders should provide incentive and the amount is proportional to the efforts of the managers. From the perspective of the managers, the higher his jealousness or proudness, the higher incentive he needs to satisfy him.This article is introduced to the fairness preference psychological problems among enterprise incentive. By introducing a fairness preference before the situation analysis, the best strategy for the enterprise, we strive to achieve Pareto increase.