A decision framework for the analysis of green supply chain contracts: An evolutionary game approach

  • Authors:

  • Sikhar Barari; Gaurav Agarwal; W.J.(Chris) Zhang; Biswajit Mahanty; M.K. Tiwari

  • Affiliations:

  • Department of Industrial Engineering and Management, Indian Institute of Technology Kharagpur, Kharagpur, India;Department of Industrial Engineering and Management, Indian Institute of Technology Kharagpur, Kharagpur, India;Department of Mechanical Engineering, University of Saskatchewan, Saskatoon, Canada;Department of Industrial Engineering and Management, Indian Institute of Technology Kharagpur, Kharagpur, India;Department of Industrial Engineering and Management, Indian Institute of Technology Kharagpur, Kharagpur, India

  • Venue:
  • Expert Systems with Applications: An International Journal
  • Year:
  • 2012

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Abstract

The overwhelming growth in the struggle between economy and ecology has led managerial research to promote methodologies to reap profits ensuring sustainability of the ecosystem thus venturing into the novel domain incorporating sustainability with supply chain management and coordination. In this paper, we look for a synergetic alliance between the environmental and commercial benefits by establishing coordination between the producer and the retailer to adjudicate their strategies to trigger green practices with the focus on maximizing economic profits by leveraging upon the product's greenness. A two player game has been developed to stand synonymous to the situation considered. Special considerations have been devised to augment the analysis with the consumer psychology towards the green products to establish a practical outlook involving the greenness and economic returns. Evolutionary dynamics has been adopted extensively to locate the optimal and the most stable point offering the best economic gains. The economically suitable solutions are then substantiated on an existing sustainability metric and hence we aim to offer a holistic view into supply chain dynamics from the perspective of environmental management. The insights drawn provide managerial implications and advantages of having environment as a key focus along with business motives.