Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
481889 | European Journal of Operational Research | 2009 | 11 Pages |
Abstract
Price variability is one of the major causes of the bullwhip effect. This paper analyzes the impact of procurement price variability in the upstream of a supply chain on the downstream retail prices. Procurement prices may fluctuate over time, for example, when the supply chain players deploy auction type procurement mechanisms, or if the prices are dictated in market exchanges. A game theory framework is used here to model a serial supply chain. Sequential price game scenarios are investigated to show that there is an increase in retail price variability and an amplified reverse bullwhip effect on prices (RBP) under certain demand conditions.
Related Topics
Physical Sciences and Engineering
Computer Science
Computer Science (General)
Authors
Ertunga C. Özelkan, Metin Çakanyıldırım,