Input Quantity Decisions Model In Risk-Averse Supply Chain Under Yield Uncertainty

With the rapid development of the economy and society,a more comprehensive ability to deal with risks is required for the enterprises.This ability is mainly reflected in how enterprises choose production strategies when facing various risk factors.Based on the consideration of practical problems,this paper introduced supply chain management model with the risk attitudes of enterprises integrated,studied the input quantity decision competition between one supplier for one buyer under yield uncertainty.By simplifying practical problems to models,this paper aims to provide the optimal decisions for enterprises to maximize the profits and risk minimization when facing input uncertainty,and it also provides the corresponding theoretical basis and support for supply chain risk management.This paper studies the implications of risk considerations in a two-echelon supply chain.We first consider a two-echelon supply chain with one supplier and one buyer,they are risk-neutral.Secondly,we investigate the optimal input quantity decisions and the variance of the supply chain profit under the mean-variance framework in three different situations: the supplier risk-averse,the buyer risk-neutral and the buyer riskaverse,the supplier risk-neutral.Under the mean-variance framework,the objective function is to maximize the supply chain's expected profit subject to a constraint on the standard deviation of the supply chain's profit.Finally,based on the model of supplier decide on input,we investigate the conditions for coordinating the supply chain by using different contracts: option contract and joint contract of revenue sharing and punishment.We find that the option contract can weaken the influence of risk constraints on enterprises,the joint contract can achieve supply chain coordination within the mean-variance framework.