Pricing Strategy Of Closed-loop Supply Chain With Reciprocity And Altruism

Although mankind has created a highly developed material civilization, but it runs out a large amount of natural resources and ecological energy, resulting in irreversible waste of resources and property loss. In order to meet the needs of economic development and environmental ecological crisis, the closed-loop supply chain management is becoming increasingly urgent in the realization of the grand blueprint of sustainable development.From the perspective of psychological game, we give each node of the closed loop supply chain the social preference of irrational feature, which induce decision maker to think of altruistic and reciprocal preference behavior tendency. Breakthrough the past researches of fairness preference oriented by outcome, given the decision maker the reciprocal preference oriented by intention, namely punish the evil and reward the angel. The existing researches all focus on pure altruism, ignoring the reciprocity is a kind of altruistic behavior with payback.Therefore this paper makes the two preferences integrate into the utility, in order to describe the payback effect between them, so that we can model and analyze the influence mechanism of the behavior tendency on the pricing strategy of closed loop supply chain. To make the model more fit the actual situation, we take the effect of complex information structure on the strategy into consideration, explore the behavior characteristics of decision makers with reciprocity and altruism, in order to provide more evidences for the cross penetration of behavior psychology and supply chain theory.This paper is based on the basic theory of closed-loop supply chain as a starting point of the logic analysis, from the perspective of psychological game theory to study the pricing and coordination of closed loop supply chain. Based on the reciprocity and altruism preference with payback, the model of closed-loop supply chain is built in this paper, in order to explorethe optimal price of enterprises nodes, and verify by numerical analysis and computer simulation. Finally, summary some management inspirations which can be used to guide the practice.The results show that reciprocal preference can expand the number of waste products recycling and the decision makers’ reciprocal behavior tendency can achieve mutual benefits.With asymmetric information as a backgroud, we can see that the manufacturers’ altruistic behaviors help curb the misrepresent behavior of retailers. The lie strategy of retailer indeed can promote a surge in its own income, but it can also reduce manufacturers’ utilities and damage system green gains. Reciprocity preference can effectively reduce the earning biases due to altruism inconsistent, and maintain a balance in revenue sharing between parties.