Fairness Concern Behavior Research Articles

A low-carbon supply chain pricing mechanism considering CSR under carbon cap-and-trade policy.

In the context of environmental deterioration and people's growing environmental protection awareness, governments or regions have put forward corresponding carbon emission reduction policies. Among them, the carbon trading mechanism, as an effective means to promote enterprises to implement emission reduction measures, plays a crucial role in regulating enterprise behavior and promoting social sustainable development. Since various industries and sectors support each other in social and economic development, it is more reasonable to study the carbon emission reduction optimization decisions of society and enterprises from the perspective of the supply chain. To achieve the carbon reduction target of the supply chain system, manufacturing enterprises usually need to incur additional costs to invest in emission reduction technologies, and retail enterprises also need to conduct low-carbon publicity to increase product market share. On one hand, considering the impact of the government's emission reduction constraints and consumers' low-carbon preferences, manufacturers will take corporate social responsibility (CSR) into consideration to enhance product competitiveness. On the other hand, smaller retailers are more concerned about being treated fairly than about their own profits due to the extra cost of low-carbon advertising. In this paper, considering the background of carbon trading, the manufacturer's CSR and retailer's fairness concern behavior are introduced into the decision-making process of the low-carbon supply chain (LCSC), and the relevant emission reduction decision-making model is constructed by using Stackelberg game theory and backward derivation method. Through comparative analysis of relevant parameters, members' profits and utilities, this paper focuses on the influence of CSR and fairness concerns on system decision-making. The results show that the optimal way for LCSC decision-making is to cooperate with fair-concerned retailers and manufacturers with CSR. When manufacturers consider social responsibility within a certain range and retailers bear part of the cost of social responsibility as followers, it can not only effectively improve the emission reduction level of the supply chain and the profits of each entity, but also help to increase the enthusiasm of each entity for carbon emission reduction and the overall social welfare.

Participant fairness concern and cost‐sharing‐based dual‐channel low‐carbon supply chain management

AbstractConsidering consumer channel preferences, our paper establishes a two‐echelon differential low‐carbon supply chain model and discusses the effects of member's cost‐sharing and fairness concerns on equilibrium results. From a static perspective, the results indicate that retailers' fairness concern behavior will lead to a decrease in pricing and participants' efforts while manufacturers cost‐sharing strategy will only enhance retailers' advertising efforts. From a dynamic perspective, products' greenness, long‐term benefits of manufacturers and retailers, and social welfare will gradually increase and eventually saturate over time. In most cases, manufacturer‐to‐retailer cost‐sharing is a win–win strategy that not only enhances the long‐term interests but also realizes the greening and upgrading of the supply chain.

Logistics service decision for e-commerce supply chain with fairness concern under uncertain environment

In this paper, we construct a two-echelon supply chain composed of an e-commerce platform and a manufacturer. We investigate the impact of manufacturer’s fairness concern (MFC) on e-commerce supply chain logistics service decisions under an uncertain environment. Given the uncertainty of the market environment, we depict unit cost of product and logistics service elasticity as uncertain variables. We construct four game-theoretical models, i.e. the manufacturer or the platform undertakes logistics service without and with considering the MFC, and compare the equilibrium solutions through numerical analysis. The results demonstrate that providing logistics services through an e-commerce platform increases the profits of all supply chain participants, regardless of whether the MFC is considered or not. Furthermore, we discover that the manufacturer will not always benefit from the MFC, the MFC can decrease the expected profits of supply chain participants. Interestingly, an increase in the level of environmental uncertainty does not necessarily imply a threat to the interests of supply chain participants. Under an uncertain environment, every supply chain participant needs to consider its fairness concern behavior and coordinate with logistics service strategies.

Study of the Impact of Fairness Concern on Low Carbon Dual Channel Supply Chain

A supplier-dominated secondary low-carbon dual channel supply chain is used as the object of study, and the expected demand function is constructed when the seller has the advantage of market information in the information asymmetry situation, in order to explore the impact of fairness concern on supply chain decision making. The utility functions in the three scenarios were analyzed and compared, and mathematical simulations were conducted according to market demand information available to the seller and the effort input of decision-making subject. Studies have shown that: Whichever decision-making subject has the fairness concern behavior does not affect the supplier as a higher profit maker; information on market demand also needs to be taken into account when considering the impact of the level of fairness concern on profits of the decision maker. When suppliers misjudge market demand, wholesale price increases are slowed if sellers have equity concerns, and sellers may engage in retaliatory behavior if equity demands are not met. In addition, low carbon demand is profitable for suppliers in supplier-led supply chains regardless of market demand, and low carbon sales efforts are not necessarily profitable for retailers.

Research on coordination of the NEV battery closed-loop supply chain considering CSR and fairness concerns in third-party recycling models

Due to the pressure of the ecological environment and government, it is incumbent for enterprises to undertake corporate social responsibility (CSR). However, during the recycling process, awareness of equity concerns due to the distribution of benefits among members has intensified, and it is crucial to resolve channel conflicts and design a reasonable cooperation model to recycle used power batteries. Therefore, this paper constructs a closed-loop supply chain composed of power battery manufacturer, retailer and third-party collector based on the consideration of cascade utilization, in order to study the impact of the level of CSR and the degree of fairness concern on the decision-making of channel participants. Our research shows that: (1) Fairness concern behavior adversely affects the supply chain, which raises the sales price and reduces the collecting rate and the utility of the supply chain as a whole. (2) Undertaking CSR is beneficial to the development of the power battery market, and also helps to reduce the sense of unfairness among third-party recycling companies. (3) The cost-sharing contract effectively coordinates the distribution of supply chain benefits and improves the recycling rate. Finally, we further verify the correctness of the conclusions through numerical studies.

Worry not rareness but disparity: Impact of fairness concerns on platforms’ pricing and matching decision in competitive two-sided markets

In two-sided markets, user fairness concerns affect a platform’s operational decisions. By constructing a hoteling-based pricing model of platforms, this study explored the impact of fairness concerns on pricing, matching, and profits in competitive two-sided markets. The conclusion of the findings of this study is that the platform will perform tilted pricing when only one side of the user conducts fairness concern behavior. Meanwhile, the difference in the platform’s pricing for bilateral users depends on the size of their “entry value” and the platform charges lower prices to users who bring them greater value. When both of the bilateral users conduct fairness concerns behaviors, the platform will capture and exploit the “disparity” mentality to obtain higher pricing power. The matching rate of the platform is affected whenever users exhibit fairness concern behaviors. Furthermore, the platform’s matching rate is lower when only one user has a higher fairness concern. Contrary to the traditional view that fairness concerns harm a platform’s profit, our findings reveal the mechanism by which unit surplus and fairness concerns jointly affect a platform’s profit. The results of our analysis demonstrate that platform operations managers can perform pricing by fully utilizing the fairness concerns of bilateral users.

Pricing and Coordination of the Extended Warranty Service Supply Chain that Considers Fairness Concerns

For the product dual-channel supply chain composed of one manufacturer and one retailer with fairness concerns, considering that the decision of products and extended warranty services in the supply chain is affected by the fairness concern behavior of retailers, the Stackelberg game method was used to establish the profit decision model of manufacturers and retailers, solved the product price, extended warranty service price and profit of each member of the supply chain during centralized and decentralized decision-making, and discussed the impact of retailer fairness concern on the optimal decision and profit of supply chain members. The results showed that with the increase of retailers' fairness concern coefficient, the wholesale price of products and the price of extended warranty service decrease, and the price of direct sales channel and retail channel price of products increase. Retailers' profits increase, manufacturers' profits, and the total profits of supply chain systems decrease.

Optimal pricing and service level in supply chain considering misreport behavior and fairness concern

In the supply chain, there exists the phenomenon that misreport behavior and fairness concern coexist. The reference point for fairness concern is usually upstream publicly disclosed profit, whereas upstream may hide its true information. Few research investigates the phenomenon deeply. To address the gap, this paper studies a supply chain consisting of a manufacturer with possible misreport behavior and one retailer with possible fairness concern. Four Stackelberg game supply chain models are constructed. Optimal decisions and profits under different scenarios are solved simultaneously and compared, and find that: Firstly, the manufacturer’s misreporting behavior is harmful to the retailer. Secondly, the retailer’s fairness concern behavior will shorten the manufacturer’s profit and help itself to face manufacturer’s misreport behavior. Thirdly, face to the retailer’s fairness concern, the manufacturer can benefit from appropriately misreporting. Through numerical analysis and extension to one-to-many general situation, the above findings are verified and analyzed.

Modeling and analysis of a sustainable supply chain with fairness concerns and green-sensitive consumer demand

PurposeWith the global spread of environmental education, environmental awareness is becoming increasingly important in daily life and economic activities. Sustainable development, as the most effective development approach to address global climate change, has gradually become a research hotspot in countries around the world. The authors combine sustainable development with supply chain management and incorporate into the study the objective issue of corporate fairness preferences in real society to explore the pricing and product greenness decision problem of a secondary sustainable supply chain consisting of a manufacturer producing green products and a retailer selling green products. In particular, the authors explore how supply chain decisions change when both the manufacturer and the retailer focus on fairness and how this fairness behavior affects pricing and product greenness decisions in sustainable supply chains.Design/methodology/approachThe authors consider that the manufacturers' greening efforts lead to expanded demand at the retail end. Upstream and downstream firms in the supply chain have preferences for the fairness of transactions. The impact of the fairness behavior of upstream and downstream firms in the supply chain on supply chain decisions is explored by building a Stackelberg game model.FindingsThe results of this study show that the fairness concern behavior of manufacturers and retailers in the supply chain has an impact on product greenness, product pricing and corporate profits.Originality/valueThis study on the fairness concern behavior of supply chain firms integrates behavioral economics and supply chain management. First, the authors consider the equilibrium problem of supply chain members in the centralized channel when there are no fairness preferences. Second, the decision problem of firms in the decentralized channel when fairness is considered and when fairness preferences are not considered is explored. The authors compare these three cases to derive the corresponding propositions. Finally, the authors verify the previous conclusions and draw other conclusions using arithmetic analysis.

Optimal production decision and financing strategy for a capital-constrained closed loop supply chain under fairness concern

This paper considers a capital-constrained closed-loop supply chain (CLSC) composed of one original equipment manufacturer (OEM) and a single remanufacturer (RM), and investigates this CLSC's optimal production and financing strategy under fairness concerns. CLSC decision-making models under four cases, namely, the OEM has adequate funds, the OEM's funds are limited without financing, the OEM has limited funds with debt financing, and the OEM's funds are limited with advance payment financing, are formulated. The equilibrium solutions in different cases are obtained through the backward induction method, the impact of fairness concern behavior on the equilibrium solutions are analyzed, and the critical conditions for OEM to adopt optimal financing strategies are obtained. The results show that: compared with the advance payment financing, the yield of new product under the debt financing situation is higher, but the yield of remanufacturing products is lower, and the sales prices of both products are higher; furthermore, the fairness concern have a smaller marginal impact on the quantities of new products, but have a larger marginal impact on the quantities of remanufactured products. Moreover, only if the OEM's initial capital is constrained and the advance payment financing ratio is below a certain threshold, the OEM will adopt advance payment financing, and when the initial capital is exceedingly scarce and the advance payment financing rate is relatively large, the manufacturer tends to adopt debt financing; with financing, the environmental impact will increase as the fairness concern grows up, while with debt financing it is even more eco-friendlier.

Complex Dynamic Analysis of Dual Channel Supply Chain with Fairness Concern and Service Cost Sharing Behavior

Complex Dynamic Analysis of Dual Channel Supply Chain with Fairness Concern and Service Cost Sharing Behavior

Joint emission reduction dynamic optimization and coordination in the supply chain considering fairness concern and reference low-carbon effect

<p style='text-indent:20px;'>In the context of low-carbon economy, in order to explore the impact of the fairness concern and reference low-carbon effect on supply chain members' balanced emission reduction decisions and profits, supply chain joint emission reduction dynamic optimization models under four different scenarios are built, in which the manufacturer's optimal emission reduction strategy, the retailer's optimal low-carbon promotion strategy and other equilibrium solutions are solved by differential game theory. On the basis of analysis, a contract is designed to achieve the coordination of the supply chain when members are fairness concern. Some findings are as follows. First, when consumers' purchasing behavior is significantly affected by the reference low-carbon effect, and they have higher expectations for the product's emission reduction level, consumers' reference low-carbon effect will discourage the manufacturer's enthusiasm to reduce emissions, and do harm to the profits of the manufacturer and the retailer. Second, the fairness concern behavior of both parties will aggravate the adverse effects of reference low-carbon effect, bring a detrimental effect on the performance of the supply chain, aggravate the double marginal effect of the supply chain, and cause continuous negative social influence. Third, the bilateral cost-sharing contract can encourage the manufacturer to increase emission reduction investment, the retailer to increase low-carbon promotion investment, and can achieve a Pareto improvement of both parties' profits and utilities. In addition, the two cost-sharing ratios are only proportional to the marginal revenue and fairness concern intensity of both parties. Finally, when the two cost-sharing ratios and the revenue-sharing coefficient meet a certain relationship and are within a reasonable range, the bilateral cost sharing-revenue sharing hybrid contract can reduce the double marginal effect and achieve supply chain coordination.</p>

Counteracting store brand introduction by the strategic incorporating of fairness concern behavior

PurposeResponding to the store brand (SB) introduction by the retailer, the manufacturer may adopt the strategic choice of incorporating the fairness concern behavior of the retailer. This paper aims to examine how the manufacturer can counteract the retailer’s SB introduction by strategically choosing to or not to incorporating the retailer’s fairness concern.Design/methodology/approachThis paper considers the SB introduction problem in a two-echelon supply chain consisting of one manufacturer and one retailer with fairness concern behavior. This paper resolves the pricing strategies under four strategic scenarios regarding fairness concern incorporation and SB introduction and examine the influences from the fairness concern on pricing strategies and profits. This paper further investigates the strategic choice equilibrium of the manufacturer and retailer on fairness concern and SB introduction decision.FindingsThe results show that the retailer can be better off by the introduction of the SB only when the acceptance degree of the SB is high enough. And whether the manufacturer should incorporate the retailer's fairness concern depends on the consumer's acceptance of the SB: Only when the consumer's acceptance is moderate, the manufacturer is able to counteract the SB by strategically not incorporating the retailer’s fairness concern behavior. Otherwise, the manufacturer cannot prevent the retailer from introducing the SB and can be better off by incorporating the retailer’s fairness concern behavior.Originality/valueThis paper contributes to the literature by examining whether the manufacturer can adopt the strategic incorporation of the retailer's fairness concern to counteract the retailer's SB introduction.

Decision-Making for Green Supply Chain Considering Fairness Concern Based on Trade Credit

Considering the deferred and risk-free interest rates, this paper focuses on the impact of fairness concern on optimal strategies about pricing, green levels and sales effort in manufacturer-led green supply chain. The results show that in the scenario with fairness neutral, the optimal benefit under decentralized decision is always less than the centralized decision, and the risk-free interest rate is larger, the difference between the two is more obvious. While in the scenario with fairness concern, the fairness degree, product greening efficiency and the return on sales work together on the greenness, sales efforts and pricing decision of the product under the condition that the Nash-negotiation solution is used as a fair reference point. Although fairness concern behavior always achieves utility fairness by harming the other party’s revenue, the overall utility of the supply chain will grow to some extent under the manufacturer’s fairness-concern behavior, which is in stark contrast to the impact of retailer’s fairness concern.

Optimal Contract Design Problem Considering the Retailer’s fairness concern with asymmetric demand information

Few works study the manufacturer’s optimal decisions in a supply chain considering the downstream retailer’s fairness concern with asymmetric demand information. Assuming that the retailer possesses private demand information and shows fairness concern behavior and that the manufacturer produces products with or without green quality, this paper derives the manufacturer’s optimal contract to screen the retailer’s private information. A basic model in which the manufacturer produces nongreen products is examined. Then, comparisons are conducted to further investigate the influences of the retailer’s fairness concern behavior and the greenness degree of products on the decision making within the supply chain, the manufacturer’s expected profits and the retailer’s expected utilities. The results show that the manufacturer can always benefit from producing green products. The retailer’s fairness concern behavior and the greenness degree of products can induce the manufacturer to change the optimal contract design strategy. Our findings can provide several managerial references for green supply chain management.

Group Buying of Competing Retailers with Fairness Concerns

The fairness concern behavior is particularly common among members in supply chain framework. The downstream retailers often compare their profits with those of the other members in the supply chain, especially that of the supplier, and do not like the unfavorable distribution of the total profits. This work considers a supply chain consisting of a supplier and two competing retailers with fairness concerns. The supplier offers a wholesale contract with quantity discount, and the two competing retailers have the options of individual purchasing and group buying. Through a Stackelberg game model, the optimal decisions for the players are obtained for the group buying and the individual purchasing strategies. The results indicate that the supplier benefits more than the retailers from the group buying strategy. In particular, the group buying strategy gives the supplier a higher profit if the operational cost of group buying is below a threshold. Furthermore, the fairness concern behavior of the retailers does not always hurt the profit of the supplier. Specifically, the supplier will benefit from the fairness concern behavior of the retailers in individual purchasing when the retailers operates in a relatively poor environment. Finally, market competition between the two fairness concerned retailers does not always benefit the supplier. Fierce competition between the fairness concerned retailers reduces the supplier’s profit if the group buying strategy is used when the retailers operates in a relatively poor environment.

Integration of online and offline channels in retail: feasibility of BOPS?

Purpose As one of the omnichannel sales models, “buy online and pick up in store” (BOPS) not only is used in the commercial field but also has gradually attracted many scholars’ interests. However, although there are numerous research ideas, most of the current work is still limited to theoretical and empirical research, and few scholars study BOPS through models. This paper aims to discuss the best market conditions and opportunities for the implementation of BOPS against the backdrop of omnichannel by means of mathematical models and data simulations and discuss the optimal price–service strategies under different sales models. Design/methodology/approach First, from the perspective of different consumer shopping types, this paper separately divides consumers into different groups in traditional “dual channel” and BOPS models. Then, the authors analyze the impact of company market size, consumer service sensitivity and the scale of BOPS on companies’ strategies and the profit of the supply chain. Subsequently, they conduct an empirical analysis through specific values. Finally, the authors further expand the model on the basis of the original research, and discuss the retailer’s fairness concerns and unit compensation strategy to ensure that the research content is more rigorous. Findings It is observed that whether companies adopt BOPS depends on consumers’ service sensitivity degree and the scale of BOPS consumers and online retailers: when the sensitivity and the proportion of online consumers are high or the number of BOPS consumers is large, it is more advantageous for companies to implement BOPS. Moreover, companies should not only consider the market scale and production cost but also have a precise orientation of consumers’ experience sensitivity and willingness to engage in extra consumption when making price and service strategies. At the same time, the compensation strategy of companies and the peer-regarding fairness concern behavior of offline retailers will affect the optimal price and service strategy in the BOPS model. Social implications These results provide managerial insights for companies preparing to implement BOPS and promote the development of relevant theories in the channel field. Originality/value At present, most of the research on BOPS is based on empirical reviews. However, this paper analyzes the applicability and feasibility of implementing BOPS by using specific models, and it will provide some reference for companies preparing to implement BOPS. In addition, this paper also discusses the unit compensation strategy and peer-regarding fairness concern behavior in the BOPS model, which have not been studied by relevant scholars.

Buyback contract coordination in supply chain with fairness concern under demand updating

ABSTRACT This paper sets supply chain buyback contract model with retailer's complete rationality and fairness concern respectively under stochastic demand, and uses Bayesian theorem to solve retailer's two-stage order decision under demand updating, so as to analyze the influence of retailer's fairness concern on the optimal order decision and the coordination of the buyback contract. The results show that the buyback contract can always coordinate the supply chain under the same condition; both the retailer's first order quantity and total order quantity decrease with wholesale price and increase with buyback price, but the retailer's fairness-concern behavior aggravates this trend.

Profit Sharing Mechanism of Large EPC Project considering the Behavior of Fairness Concern

A large‐scale engineering procurement and construction (EPC) project is often conducted by a joint venture. Many factors affect the success of cooperation among participating enterprises, such as trust and the degree of effort of both parties. The most important one is a rational profit sharing mechanism. Reasonable profit sharing mechanism concerns whether the advantages of the EPC model can be fully utilized. In this study, the proposed EPC project is undertaken by a joint venture integrating design and construction enterprises. Moreover, the profit sharing problem arises from the project optimization implemented by both parties. The fairness concern behavior of both parties is considered, and the profit sharing model for the EPC project is established on the basis of game theory. The effect of the fairness concern behavior of both parties on the EPC project optimization and its profit sharing is further analyzed by simulation analysis. The research findings show that the project optimization profit and its sharing are related to not only the efforts and cost coefficient but also the fairness concern behavior of both parties. The research results are conducive to the application of the EPC model in the field of construction engineering.

Carbon emission reduction and profit distribution mechanism of construction supply chain with fairness concern and cap-and-trade.

Fairness concern behavior is extremely common in social life, and many scholars are beginning to pay attention to this behavior. In this study, we investigate a two-echelon construction supply chain that consists of a general contractor and a subcontractor under cap-and-trade policy. We study the carbon emission reduction decisions and profit distribution mechanism in the construction supply chain with fairness concern and cap-and-trade. We use the Nash bargaining model to describe the fairness concerns of the construction supply chain members and use the co-opetition model to portray the profit distribution. We show that the fairness concern can impose an adverse influence on firms’ profits and decrease the magnitude of their carbon emission reductions. The subcontractor’s fairness concern causes greater losses to the construction supply chain’s profit. We further demonstrate the impact of fairness concern on the optimal decisions of the general contractor and the subcontractor through numerical analysis.