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Equilibrium Optimization with Multi-Energy-Efficiency-Grade Products: Government and Market Perspective

Author

Listed:
  • Qiuyun Zhu

    (School of Economics and Management, Xidian University, Xi’an 710126, China)

  • Xiaoyang Zhou

    (School of Management, Xi’an Jiaotong University, Xi’an 710049, China)

  • Aijun Liu

    (School of Economics and Management, Xidian University, Xi’an 710126, China)

  • Chong Gao

    (School of Economics and Management, Xidian University, Xi’an 710126, China)

  • Lei Xu

    (Economics and Management College, Civil Aviation University of China, Tianjin 300300, China)

  • Fan Zhao

    (School of Economics and Management, Xidian University, Xi’an 710126, China)

  • Ding Zhang

    (School of Business, State University of New York at Oswego, Oswego, NY 13126, USA)

  • Benjamin Lev

    (Decision Sciences Department, LeBow College of Business, Drexel University, Philadelphia, PA 19104, USA)

Abstract

This paper studies the multi-level supply chain network equilibrium optimization problem of multi-energy-efficiency products under different government subsidies and demand scales. In the equilibrium optimization problem, manufacturers determine the production volume of the energy-saving products; retailers decide the transaction volume with manufacturers, distribution volume for markets, and marketing efforts of energy-saving products; markets determine the transaction price. Firstly, the optimal decision-making behaviors of manufacturers, retailers, and markets are described. Simultaneously, the global optimization problem is transformed into a finite-dimensional variational inequality formulation. Then, the equilibrium conditions of the whole supply chain network are derived by the Euler method. Finally, a case study verifies the effectiveness of the proposed method. Interestingly, we found that energy-saving subsidies and demand scales were negatively correlated with the marketing efforts of the subsidized retailers for high energy-efficient products and positively correlated with the marketing efforts of non-subsidized retailers for high energy-efficient products in the same market; the development of retailers in the same market tended to be consistent, and the differentiation of the demand scale eliminated the retailers without a competitive advantage.

Suggested Citation

  • Qiuyun Zhu & Xiaoyang Zhou & Aijun Liu & Chong Gao & Lei Xu & Fan Zhao & Ding Zhang & Benjamin Lev, 2022. "Equilibrium Optimization with Multi-Energy-Efficiency-Grade Products: Government and Market Perspective," Energies, MDPI, vol. 15(19), pages 1-23, October.
    • Handle: RePEc:gam:jeners:v:15:y:2022:i:19:p:7376-:d:935968
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    References listed on IDEAS

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