A game-theoretical approach for the adoption of government-supported blockchain application in the IoT-enabled agricultural supply chain

Abstract

Establishing a reliable, cost-effective, and data-accessible supply chain is a requirement for all administrations. The significance of such a supply chain lies in its ability to strengthen national resiliency, ensure economic security, and foster sustainable growth. Governments know financial investments and subsidies in infrastructure, logistics, and technology are necessary for a robust supply chain. This paper proposes an IoT-enabled agricultural supply chain that integrates with a cooperative Nash game between two parties: telecommunications operators and agricultural enterprises. The aim is to establish cooperative decision-making procedures in advance of the integration of blockchain technology into the supply chain, which is regulated by the subsidy policy of the government. The Nash game yields a unique Nash equilibrium, indicating that both parties can engage in cooperative negotiations regarding their participation in the blockchain application to maximize their financial profits. To illustrate the efficacy of Nash collaboration in blockchain adoption, this study presents two scenarios where non-cooperative behavior is explored to analyze stakeholder responses in competitive contexts. Numerical results justify the theoretical findings and suggest Nash cooperation among stakeholders instead of competition in the blockchain-based agri-food market, which leads to a more accessible market environment that ultimately benefits consumers. Moreover, the positive and negative aspects of the deployment of the government-supported blockchain application are derived through sensitivity analyses conducted on subsidy rate, agricultural market price, subsidy amount, and blockchain market. Practical managerial implications are derived from the findings and observations to help policymakers formulate blockchain policies in agricultural supply chains supported by governments.