Buy-back Contract Supply Chain Innovation and Coordination Mechanism Based on Mean-CVaR

doi:10.3969/j.issn.1007-7375.2019.05.006

Abstract

Abstract: In order to study order quantity and coordination mechanism of buy-back contract supply chain under manufacturer innovation, the Stackelberg game model of buy-back contract supply chain is established. Then the issue of innovation coordination is discussed by the mean-CVaR decision criterion, and it shows that the mean-CVaR criterion can help to increase the order quantity more than CVaR, and the risk aversion level of retailer affect innovation and requirement of supply chain. The retailer's risk preference will increase the innovation investment intensity and the whole demand of supply chain channel. Improving the buy-back contracts through restricting the repurchase quantity in consideration of the potential risk of over-ordering by retailers, the results show that the improved buy-back contracts can reduce the order quantity, and under certain conditions the improved buy-back contracts can coordinate the supply chain. At last, how λ and β influence the retailer's quantity and manufacturer's innovation investment intensity is analyzed by numerical examples.

Key words: risk averse, supply chain coordination, buy-back contract, conditional value-at-risk (CVaR)

CLC Number:

C934
F274

SHANG Chunyan, GUAN Zhimin, Mi Liyang. Buy-back Contract Supply Chain Innovation and Coordination Mechanism Based on Mean-CVaR[J]. Industrial Engineering Journal , 2019, 22(5): 43-49,67.

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