Abstract
Consumer’s valuation of merchandise is an important factor affecting consumer buying behavior. When the consumer’s valuation exceeds the price of product, the consumer generally makes a decision to purchase the product; conversely, when the consumer’s estimate is lower than the price of product, the consumer will usually refuse to buy the product. From the perspective of consumer product valuation, this study assumed that the consumer’s product valuation obeys a uniform distribution, and a novel consumer demand function was proposed. On this basis, we studied enterprises’ pricing decisions in the supply chain of green agricultural products and obtained the equilibrium prices and optimal profits of the enterprises in several different scenarios, including Vertical Nash game model (VNM), firm A Stackelberg game model (FASM), firm B Stackelberg game model (FBSM), and cooperative game model (CM). In addition, the influence of parameters, such as green level, green preference payment coefficient, and green cost on the optimal profit, was discussed based on game theory and numerical simulation analysis. It was found that equilibrium prices always existed in several different scenarios, and when consumer’s green preference payment coefficient was large enough, the optimal profit of firm B was greater than the optimal profit of firm A. Furthermore, in CM, the sum of optimal profit of firm A and optimal profit of firm B is maximum for four scenarios. Finally, in the three competitive scenarios, green level, green preference payment coefficient, and green cost, have a positive or negative effect on the optimal profits of firm A or firm B. The research conclusions of this study provided theoretical support for the decision-making of enterprises and related management departments.
Highlights
In recent years, the ecosystems globally have been severely affected by excessive human production activities [1]. e environmental pressures for human existence are getting worse
For a > 2b, the optimal profit of firm B is greater than the optimal profit of firm A in the three scenarios of Vertical Nash game model (VNM), firm A Stackelberg game model (FASM), and cooperative game model (CM)
Proposition 1 indicates that when the value of consumers’ green preference payment coefficient a is large enough, especially, for a > 2b, the optimal profit of firm B usually is greater than the optimal profit of firm A. is result is consistent with intuitive cognition in real life. is shows that increasing consumer’s green payment coefficient can improve the production enthusiasm of green production firm and promote the development of green agriculture. erefore, measures such as green subsidy policies of relevant government departments or green consumption propaganda of related groups will definitely accelerate the development of green agriculture. It implied that at the three phases of development of the green agriculture, initial stage (FASM), middle stage (VNM), and later stage (FBSM), the condition that the optimal profit of firm B is greater than the optimal profit of firm A is getting higher and higher, namely, the enthusiasm of green production firm gradually decrease
Summary
The ecosystems globally have been severely affected by excessive human production activities [1]. e environmental pressures for human existence are getting worse. Ghosh and Shah [3] studied the coordination of GSC channels under several different power structure scenarios and compared the optimal pricing and green decision-making of supply chain participants in each structure when demand was linear and deterministic function depending on the retail price and product green quality. Based on fuzzy and uncertain consumer demand and manufacturing costs, Yang and Xiao [10] proposed three game models with government intervention in the GSC and studied how channel power structure and government intervention affect optimal prices, green levels, and profits. Our work proposes game theoretic models in green supply chain including two farm produce plantation firms and their own retailers; it is different from previous studies; we construct a novel demand function from the perspective of consumers merchandise valuation, and the demand function is nonlinear and deterministic with respect to retail price and greening level. Stackelberg game model (FASM), firm B Stackelberg game model (FBSM), and cooperative game model (CM); in addition, the effect of main parameters (green level, green preference, green cost) on the optimal profit is analyzed
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