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Decision Analysis of Advertising and Price for Bilateral Competing Supply Chain

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  • Cheng-Tang Zhang
  • Shan-Lin Yang

Abstract

The outcome of centralized equilibrium, prisoner's dilemma equilibrium, and decentralized equilibrium under different decision models has been provided with regards to bilateral competing supply chain system, either side of which is composed of one manufacturer and one retailer. Theoretical analysis indicates a positive correlation between price and one's own advertising investment level and a negative correlation between price and the opponent's advertising investment level. Through analysis of numerical examples, the results reveal a first mover advantage that leads to prisoner's dilemma in the system as well as the impact that price and advertising competition intensity has on the supply chain's choice of decision model.

Suggested Citation

  • Cheng-Tang Zhang & Shan-Lin Yang, 2013. "Decision Analysis of Advertising and Price for Bilateral Competing Supply Chain," Mathematical Problems in Engineering, Hindawi, vol. 2013, pages 1-7, June.
    • Handle: RePEc:hin:jnlmpe:395210
    DOI: 10.1155/2013/395210
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    Cited by:

    1. Chen, Zhisong & Su, Shong-Iee Ivan, 2022. "Countervailing effect and mitigation policy: A game-theoretical study in dual international competing photovoltaic supply chains," Renewable Energy, Elsevier, vol. 183(C), pages 160-171.

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