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An evolutionary analysis of supply chain collaborative information sharing based on prospect theory
Meng Liu1,2, Luyu Zhai3, Hongcheng Gan1,2
1Business School, University of Shanghai for Science and Technology, Shanghai, China.
Plos One
|March 15, 2024
Summary
Supply chain collaboration improves when information sharing costs decrease and coordination benefits increase. Entities are more likely to share information when they are less risk-averse with profits and more risk-seeking with losses.
Area of Science:
- Operations Research
- Supply Chain Management
- Game Theory
Background:
- Supply chain collaboration is crucial for efficiency.
- Understanding information sharing dynamics is key.
- Psychological factors influence decision-making.
Purpose of the Study:
- To model the evolution of information sharing decisions.
- To identify factors influencing these decisions in supply chains.
- To analyze strategic choices considering psychological perceptions.
Main Methods:
- Constructed an evolutionary game model with suppliers and retailers.
- Integrated game theory and prospect theory.
- Utilized prospect value functions, weight functions, and numerical simulations in Matlab.
Main Results:
- Information sharing probability is negatively correlated with cost and positively with coordination benefits.
- Entities with lower risk aversion (profits) and higher risk preference (losses) favor information sharing.
- Reduced sensitivity to losses promotes information sharing.
Conclusions:
- Findings offer insights into enhancing supply chain trust and collaboration.
- Recommendations include building information exchange platforms and managing psychological awareness.
- Improved information sharing leads to greater supply chain efficiency.
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