IDEAS home Printed from https://ideas.repec.org/a/eee/proeco/v169y2015icp333-342.html
   My bibliography  Save this article

Coalitional game theory approach to modeling suppliers' collaboration in supply networks

Author

Listed:
  • Mohebbi, Shima
  • Li, Xueping

Abstract

Suppliers' collaboration is a new paradigm to improve the utilization of collective intelligence in supply networks. Although existing literature advocates the notion of cooperation in supply networks, there is a dearth of studies quantitatively analyzing cost and benefit of cooperation. In this study, we first develop a model for suppliers' dynamic coalition formation using coalitional game theory. The proposed cost structure influences the utility of each possible coalition and restricts the coalition size and search space for finding possible coalitions. To distribute the profit earned by cooperation in a fair manner, a criterion named Shared Capacity Index is developed according to suppliers' capacity share in the corresponding coalition. A suppliers' cooperation algorithm is then proposed to resolve possible conflicts among network members whereby each supplier is able to explore coalitional structures autonomously. The efficiency of the proposed approach is evaluated through simulation studies and compared to other solution methods, including Shapley value and Proportional Fairness. Results demonstrate that long-term cooperation among suppliers leads to enhanced average individual profit in the network.

Suggested Citation

  • Mohebbi, Shima & Li, Xueping, 2015. "Coalitional game theory approach to modeling suppliers' collaboration in supply networks," International Journal of Production Economics, Elsevier, vol. 169(C), pages 333-342.
    • Handle: RePEc:eee:proeco:v:169:y:2015:i:c:p:333-342
    DOI: 10.1016/j.ijpe.2015.08.022
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0925527315003187
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ijpe.2015.08.022?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Charles, Shannon L. & Hansen, Don R., 2008. "An evaluation of activity-based costing and functional-based costing: A game-theoretic approach," International Journal of Production Economics, Elsevier, vol. 113(1), pages 282-296, May.
    2. Charles, Shannon L. & Hansen, Don R., 2008. "An evaluation of activity-based costing and functional-based costing: A game-theoretic approach," International Journal of Production Economics, Elsevier, vol. 113(1), pages 480-494, May.
    3. Zhang, Juan & Gou, Qinglong & Liang, Liang & Huang, Zhimin, 2013. "Supply chain coordination through cooperative advertising with reference price effect," Omega, Elsevier, vol. 41(2), pages 345-353.
    4. Jin, Mingzhou & Wu, S. David, 2006. "Supplier coalitions in on-line reverse auctions: Validity requirements and profit distribution scheme," International Journal of Production Economics, Elsevier, vol. 100(2), pages 183-194, April.
    5. Hennet, Jean-Claude & Mahjoub, Sonia, 2010. "Toward the fair sharing of profit in a supply network formation," International Journal of Production Economics, Elsevier, vol. 127(1), pages 112-120, September.
    6. Wang, Hongwei & Guo, Min & Efstathiou, Janet, 2004. "A game-theoretical cooperative mechanism design for a two-echelon decentralized supply chain," European Journal of Operational Research, Elsevier, vol. 157(2), pages 372-388, September.
    7. Hua, Zhongsheng & Li, Sijie, 2008. "Impacts of demand uncertainty on retailer's dominance and manufacturer-retailer supply chain cooperation," Omega, Elsevier, vol. 36(5), pages 697-714, October.
    8. Arnold, Tone & Schwalbe, Ulrich, 2002. "Dynamic coalition formation and the core," Journal of Economic Behavior & Organization, Elsevier, vol. 49(3), pages 363-380, November.
    9. Lozano, S. & Moreno, P. & Adenso-Díaz, B. & Algaba, E., 2013. "Cooperative game theory approach to allocating benefits of horizontal cooperation," European Journal of Operational Research, Elsevier, vol. 229(2), pages 444-452.
    10. Drechsel, J. & Kimms, A., 2010. "Computing core allocations in cooperative games with an application to cooperative procurement," International Journal of Production Economics, Elsevier, vol. 128(1), pages 310-321, November.
    11. Seok, Hyesung & Nof, Shimon Y., 2014. "Dynamic coalition reformation for adaptive demand and capacity sharing," International Journal of Production Economics, Elsevier, vol. 147(PA), pages 136-146.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Eduardo Alarcon-Gerbier & Zarina Chokparova & Nassim Ghondaghsaz & Wanqi Zhao & Hani Shahmoradi-Moghadam & Uwe Aßmann & Orçun Oruç, 2022. "Software-Defined Mobile Supply Chains: Rebalancing Resilience and Efficiency in Production Systems," Sustainability, MDPI, vol. 14(5), pages 1-21, February.
    2. Jianbo Zhu & Miao Fang & Qianqian Shi & Peng Wang & Qian Li, 2018. "Contractor Cooperation Mechanism and Evolution of the Green Supply Chain in Mega Projects," Sustainability, MDPI, vol. 10(11), pages 1-15, November.
    3. A-Ru-Han Bao & Yao Liu & Jun Dong & Zheng-Peng Chen & Zhen-Jie Chen & Chen Wu, 2022. "Evolutionary Game Analysis of Co-Opetition Strategy in Energy Big Data Ecosystem under Government Intervention," Energies, MDPI, vol. 15(6), pages 1-24, March.
    4. Elisabeth Gutierrez & Natividad Llorca & Manuel Mosquera & Joaquin Sanchez-Soriano, 2019. "On horizontal cooperation in linear production processes with a supplier that controls a limited resource," Mathematical Methods of Operations Research, Springer;Gesellschaft für Operations Research (GOR);Nederlands Genootschap voor Besliskunde (NGB), vol. 90(2), pages 169-196, October.
    5. Berlilana & Tim Noparumpa & Athapol Ruangkanjanases & Taqwa Hariguna & Sarmini, 2021. "Organization Benefit as an Outcome of Organizational Security Adoption: The Role of Cyber Security Readiness and Technology Readiness," Sustainability, MDPI, vol. 13(24), pages 1-20, December.
    6. Chen, Yenming J. & Chen, Tsung-Hui, 2019. "Fair sharing and eco-efficiency in green responsibility and green marketing policy," International Journal of Production Economics, Elsevier, vol. 217(C), pages 232-245.
    7. Xueping Wang & Xin Yuan & Xinqin Gao, 2022. "Game Strategy Selection of Multiple Participants in Cloud Manufacturing Alliance," SAGE Open, , vol. 12(2), pages 21582440221, May.
    8. Jian Li & Jian-qiang Wang & Jun-hua Hu, 2019. "Interval-valued n-person cooperative games with satisfactory degree constraints," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 27(4), pages 1177-1194, December.
    9. Martin Holubčík & Jakub Soviar, 2021. "Main Problems of Cooperation Management: Insights from Slovak Companies," Sustainability, MDPI, vol. 13(12), pages 1-19, June.
    10. Zheng, Qi & Zhou, Li & Fan, Tijun & Ieromonachou, Petros, 2019. "Joint procurement and pricing of fresh produce for multiple retailers with a quantity discount contract," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 130(C), pages 16-36.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hennet, Jean-Claude & Mahjoub, Sonia, 2010. "Toward the fair sharing of profit in a supply network formation," International Journal of Production Economics, Elsevier, vol. 127(1), pages 112-120, September.
    2. C. Homburg & Julia Nasev & Philipp Plank, 2018. "The impact of cost allocation errors on price and product-mix decisions," Review of Quantitative Finance and Accounting, Springer, vol. 51(2), pages 497-527, August.
    3. Askarany, Davood & Yazdifar, Hassan, 2012. "An investigation into the mixed reported adoption rates for ABC: Evidence from Australia, New Zealand and the UK," International Journal of Production Economics, Elsevier, vol. 135(1), pages 430-439.
    4. Kimms, A. & Kozeletskyi, I., 2016. "Core-based cost allocation in the cooperative traveling salesman problem," European Journal of Operational Research, Elsevier, vol. 248(3), pages 910-916.
    5. Palsule-Desai, Omkar D. & Tirupati, Devanath & Chandra, Pankaj, 2013. "Stability issues in supply chain networks: Implications for coordination mechanisms," International Journal of Production Economics, Elsevier, vol. 142(1), pages 179-193.
    6. Li, Sijie & Zhu, Zhanbei & Huang, Lihua, 2009. "Supply chain coordination and decision making under consignment contract with revenue sharing," International Journal of Production Economics, Elsevier, vol. 120(1), pages 88-99, July.
    7. Cleophas, Catherine & Cottrill, Caitlin & Ehmke, Jan Fabian & Tierney, Kevin, 2019. "Collaborative urban transportation: Recent advances in theory and practice," European Journal of Operational Research, Elsevier, vol. 273(3), pages 801-816.
    8. Askarany, Davood & Yazdifar, Hassan & Askary, Saeed, 2010. "Supply chain management, activity-based costing and organisational factors," International Journal of Production Economics, Elsevier, vol. 127(2), pages 238-248, October.
    9. A. Panakhov U. & E. Babkova G. & А. Панахов У. & Э. Бабкова Г., 2019. "Интеграция методов управленческого учета в системе функционального учета затрат // The Integration of Management Accounting Techniques in the Functional-based Costing System," Учет. Анализ. Аудит // Accounting. Analysis. Auditing, ФГОБУВО "Финансовый университет при Правительстве Российской Федерации" // Financial University under The Government of Russian Federation, vol. 6(4), pages 42-52.
    10. Christoph Weissbart, 2018. "Decarbonization of Power Markets under Stability and Fairness: Do They Influence Efficiency?," ifo Working Paper Series 270, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    11. Guajardo, Mario & Rönnqvist, Mikael, 2015. "Operations research models for coalition structure in collaborative logistics," European Journal of Operational Research, Elsevier, vol. 240(1), pages 147-159.
    12. Sonia Mahjoub & Jean-Claude Hennet, 2014. "Manufacturers’ Coalition under a Price Elastic Market - a Quadratic Production Game Approach," Post-Print hal-01479690, HAL.
    13. Baykasoglu, Adil & Kaplanoglu, Vahit, 2008. "Application of activity-based costing to a land transportation company: A case study," International Journal of Production Economics, Elsevier, vol. 116(2), pages 308-324, December.
    14. Basso, Franco & Guajardo, Mario & Varas, Mauricio, 2020. "Collaborative job scheduling in the wine bottling process," Omega, Elsevier, vol. 91(C).
    15. Behzad Hezarkhani & Marco Slikker & Tom Woensel, 2016. "A competitive solution for cooperative truckload delivery," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 38(1), pages 51-80, January.
    16. An, Qingxian & Wen, Yao & Ding, Tao & Li, Yongli, 2019. "Resource sharing and payoff allocation in a three-stage system: Integrating network DEA with the Shapley value method," Omega, Elsevier, vol. 85(C), pages 16-25.
    17. Tsai, Wen-Hsien & Lai, Chien-Wen & Tseng, Li-Jung & Chou, Wen-Chin, 2008. "Embedding management discretionary power into an ABC model for a joint products mix decision," International Journal of Production Economics, Elsevier, vol. 115(1), pages 210-220, September.
    18. Yilmaz, Ibrahim & Yoon, Sang Won & Seok, Hyesung, 2017. "A framework and algorithm for fair demand and capacity sharing in collaborative networks," International Journal of Production Economics, Elsevier, vol. 193(C), pages 137-147.
    19. Mario Guajardo & Kurt Jörnsten & Mikael Rönnqvist, 2016. "Constructive and blocking power in collaborative transportation," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 38(1), pages 25-50, January.
    20. Bo Wang & Ning Wang, 2022. "Decision Models for a Dual-Recycling Channel Reverse Supply Chain with Consumer Strategic Behavior," Sustainability, MDPI, vol. 14(17), pages 1-18, August.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:proeco:v:169:y:2015:i:c:p:333-342. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/ijpe .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.