Study on Buyback Contract in Supply Chain With a Loss-Averse Supplier and Multiple Loss-Averse Retailers Under Stockout Loss Situation

Yanyan CUI, Xueyi CHEN

Abstract


According to the prospect theory and the loss-aversion function, this paper developers the buyback contract model in a two-stage supply chain with a loss-averse supplier and multiple loss-averse retailers. Under the stockout loss setting, we analyze the effect of the loss aversion on the behavior from the retailers and the supplier, and then the buyback contract has been shown to be able to coordinate the supply chain. Furthermore, the number of retailers and loss aversion coefficient meet a certain range, there will be a unique optimal buyback price to achieve supply chain coordination.


Keywords


Stockout loss; Loss aversion; Buyback contract

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References


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DOI: http://dx.doi.org/10.3968/n

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