A Game Theoretical Approach to Competition Between Members of a Green Supply Chain with Hybrid Products

Document Type : Research Paper

Authors

1 Faculty of Industrial and Systems Engineering, Tarbiat Modares University, Tehran, Ira

2 Conflict Analysis Group, Department of Systems Design Engineering, University of Waterloo, Waterloo, Canada.

3 Faculty of Industrial and Systems Engineering, Tarbiat Modares University, Tehran, Iran

Abstract

With progressing technologies green products are in competition with non-green products. In real world, there exist many firms that produce green and non-green products. In this study, a green supply chain(GSC) with a supplier and a manufacturer is considered. The supply chain(SC) produces green and non-green products. Market demands for both non-green and green products are available. These products might be replaced with each other. If the demand isn't satisfied by green products, hybrid production mode involving green and non-green products is chosen by the manufacturer. The government is considered as the leader of the game and fixes special tariffs(tax and subsid) for all products to control the market demand. A game theoretical model is formulated in four scenarios by considering collaboration of members in the SC. The ideal prices of raw materials, selling prices, and demand for green and non-green products are calculated. A numerical example that consists of sensitivity analysis of some main parameters is presented to compare the outcomes of various scenarios. The results indicate that collaboration between supplier and manufacturer has significant impact on a profit of GSC. Besides, Various consumer’s priorities are covered in hybrid production mode. The results show that by choosing hybrid production mode, the profit of SC decreases and hybrid production mode hasn't positive role on profit of SC and membership. Sensitive analysis shows that increasing tariffs by government causes an increase in summation profit function of GSC and profit function of member of GSC. Moreover, the demand for non-green products increases.

Keywords

References

       [1]        Abdolazimi, O., Salehi Esfandarani, M., Salehi, M. and Shishebori, D., 2020. A Comparison of Solution Methods for the Multi-Objective Closed Loop Supply Chains. Advances in Industrial Engineering, 54(1), pp.75-98.
       [2]        Chen, Y.J. and Sheu, J.B., 2009. Environmental-regulation pricing strategies for green supply chain management. Transportation Research Part E: Logistics and Transportation Review, 45(5), pp.667-677.
       [3]        Chen, Y.J., Sheu, J.B. and Lirn, T.C., 2012. Fault tolerance modeling for an e-waste recycling supply chain. Transportation Research Part E: Logistics and Transportation Review, 48(5), pp.897-906.
       [4]        Esmaeili, M. and Zandi, S., 2018. Intervention of Government in the Competition between Green and Non-Green Supply Chains. Industrial Management Journal, 10(2), pp.297-314.
       [5]        Hadi, T., Chaharsooghi, S.K., Sheikhmohammady, M. and Hafezalkotob, A., 2020. Pricing strategy for a green supply chain with hybrid production modes under government intervention. Journal of Cleaner Production, 268, p.121945.
       [6]        Hadi, T., Sheikhmohammady, M., Chaharsooghi, S.K. and Hafezalkotob, A., 2021. Competition between regular and closed-loop supply chains under financial intervention of government; a game theory approach. Journal of Industrial and Systems Engineering, 13(2), pp.179-199.
       [7]        Hafezalkotob, A., 2015. Competition of two green and regular supply chains under environmental protection and revenue seeking policies of government. Computers & Industrial Engineering, 82, pp.103-114.
       [8]        Hafezalkotob, A. and Hadi, T., 2015. Impact of government’s policies on competition of two closed-loop and regular supply chains. Journal of Industrial and Systems Engineering, 8(4), pp.87-105.
       [9]        Hafezalkotob, A., 2017. Competition, cooperation, and coopetition of green supply chains under regulations on energy saving levels. Transportation Research Part E: Logistics and Transportation Review, 97, pp.228-250.
     [10]      Hafezalkotob, A., 2018. Direct and indirect intervention schemas of government in the competition between green and non-green supply chains. Journal of Cleaner Production, 170, pp.753-772.
     [11]      Javadi, T., Alizadeh-Basban, N., Asian, S. and Hafezalkotob, A., 2019. Pricing policies in a dual-channel supply chain considering flexible return and energy-saving regulations. Computers & Industrial Engineering, 135, pp.655-674.
     [12]      Jolai, F., Hashemi, P., Heydari, J., Bakhshi, A. and Keramati, A., 2020. Optimizing a Reverse Logistics System by Considering Quality of Returned Products. Advances in Industrial Engineering, 54(2), pp.165-184.
     [13]      Jolai, H., Hafezalkotob, A. and Reza-Gharehbagh, R., 2021. Pricing and greening decisions of competitive forward and reverse supply chains under government financial intervention: Iranian motorcycle industry case study. Computers & Industrial Engineering, 157, p.107329.
     [14]      Khalafi, S., Hafezalkotob, A., Mohamaditabar, D. and Sayadi, M.K., 2020. A novel model for a network of a closed-loop supply chain with recycling of returned perishable goods: A case study of dairy industry. Journal of Industrial and Systems Engineering, 12(4), pp.136-153.
     [15]      Khosroshahi, H., Rasti-Barzoki, M. and Hejazi, S.R., 2019. A game theoretic approach for pricing decisions considering CSR and a new consumer satisfaction index using transparency-dependent demand in sustainable supply chains. Journal of Cleaner Production, 208, pp.1065-1080.
     [16]      Mahmoudi, R. and Rasti-Barzoki, M., 2018. Sustainable supply chains under government intervention with a real-world case study: An evolutionary game theoretic approach. Computers & Industrial Engineering, 116, pp.130-143.
     [17]      Malekpour, H., Hafezalkotob, A. and Khalili-Damghani, K., 2021. Product Processing Prioritization in Hybrid Flow Shop Systems Supported on Nash Bargaining Model and Simulation-Optimization. Expert Systems with Applications, p.115066.
     [18]      Murphy, J. and Gouldson, A., 2009. Environmental policy and industrial innovation: integrating environment and economy through ecological modernisation (pp. 275-294). Routledge.
     [19]      Noori Daryan, M. and Taleizadeh, A., 2018. Developing an Economic Production Quantity Model in Integrated and Non-integrated Three-Layer Supply Chains with an Optimal Inventory Control Policy. Advances in Industrial Engineering, 52(1), pp.125-137.
     [20]      Safarzadeh, S., Rasti-Barzoki, M., Hejazi, S.R. and Piran, M.J., 2020. A game theoretic approach for the duopoly pricing of energy-efficient appliances regarding innovation protection and social welfare. Energy, 200, p.117517.
     [21]      Sinayi, M. and Rasti-Barzoki, M., 2018. A game theoretic approach for pricing, greening, and social welfare policies in a supply chain with government intervention. Journal of Cleaner Production, 196, pp.1443-1458.
     [22]      Sheu, J.B., 2011. Bargaining framework for competitive green supply chains under governmental financial intervention. Transportation Research Part E: Logistics and Transportation Review, 47(5), pp.573-592.
     [23]      Taleizadeh, A. and Sarokhani, A., 2017. Cooperative Advertising and Pricing in a Competitive Market with Customers’ Excitations Effects. Advances in Industrial Engineering, 51(3), pp.351-361.
     [24]      Taleizadeh, A. and Vedadi-Moghaddam, S., 2016. Optimizing Wholesale and Retail Prices, Quality and Marketing Improvement Efforts in a Closed-Loop Supply Chain Using a Game Theory. Advances in Industrial Engineering, 50(1), pp.121-131.
     [25]      Taleizadeh, A.A. and Sadeghi, R., 2019. Pricing strategies in the competitive reverse supply chains with traditional and e-channels: A game theoretic approach. International Journal of Production Economics, 215, pp.48-60.
     [26]      Tong, W., Mu, D., Zhao, F., Mendis, G.P. and Sutherland, J.W., 2019. The impact of cap-and-trade mechanism and consumers’ environmental preferences on a retailer-led supply Chain. Resources, Conservation and Recycling, 142, pp.88-100.
     [27]      Wang, S., Luo, T. and Chang, D., 2021. Pricing Strategies of Multichannel Apparel Supply Chain Based on Showrooming and Information Sharing. Mathematical Problems in Engineering, 2021.
     [28]      Yazdanpanah, A.H., Akbari, A.A. and Mozafari, M., 2019. A Game Theoretical Approach to Optimize Policies of Government Under the Cartel of Two Green and Non-green Supply Chains. Journal of Optimization in Industrial Engineering, 12(2), pp.189-197.
     [29]      Zerang, E.S., Taleizadeh, A.A. and Razmi, J., 2018. Analytical comparisons in a three-echelon closed-loop supply chain with price and marketing effort-dependent demand: game theory approaches. Environment, development and sustainability, 20(1), pp.451-478.
Advances in Industrial Engineering
Volume 54, Issue 4
October 2020
Pages 381-399

Files

Share

How to cite

Statistics