Ordering Decisions of Supply Chain with Competition and Dual-Fairness Concern

Abstract

This study studies a supply chain consisting of one supplier and two retailers and analyzes the optimal decisions of ordering quantity in four types of no fairness concern, horizontal fairness concern, vertical fairness concern, and dual-fairness concern and the impacts of fairness concern on supply chain. The results show that (1) vertical fairness concern can decrease the ordering quantity of the retailer with vertical fairness concern and the wholesale price and improve the ordering quantity of the retailer without fairness concern; (2) horizontal fairness concern can increase the ordering quantity of the retailer with horizontal fairness concern and improve the ordering quantity of the retailer without fairness concern, but does not influence the wholesale price; and (3) dual-fairness concern can decrease the ordering quantity of the retailer with dual-fairness concern and the wholesale price and improve the ordering quantity of the retailer without fairness concern as a whole. The numerical analysis also proves the findings.