Shaofu Du

Multi-product newsboy problem with limited capacity and outsourcing

This paper considers a multi-product newsboy system that produces multiple products for fulfilling independently uncertain demands, which share the same production capacity. To deal with possible shortage of limited capacity, productions can be outsourced. We consider two outsourcing strategies: zero lead time outsourcing, and nonzero lead time outsourcing. The structural properties and solution procedures for the profit-maximization models are developed. Numerical results are provided for obtaining some managerial insights.

A DEA-based approach for fair reduction and reallocation of emission permits

Abstract How to allocate initial emission permits is vital for the cap-and-trade system in controlling the total emission level and improving the operation efficiency of the trade mechanism. And data envelopment analysis (DEA) has been proved to be more suitable to fairly resolve the problem as a performance-based allocation is involved here. In this paper, we present a novel DEA approach for fair reduction and reallocation of emission permits for areas under administration. The presented DEA models are based on the ideas, where, according to their eco-efficiency and current emission levels, all decision making units (DMUs) compete with each other for the least reduction amount by introducing a bargaining game, on the other hand, the central authority can improve the overall efficiency by reallocating the remaining emission permits. The approach is applied on the dataset of agricultural greenhouse gas emissions from 15 European Union members (EU15). The results of the application show that the reduction and reallocation mechanism is fair, which benefits the countries that work at the optimal scale operation while punishes those that fail to operate on the optimal scale. Furthermore, it is effective in improving the overall efficiency of the system.

Newsvendor Model for a Dyadic Supply Chain with Nash Bargaining Fairness Concerns

The paper investigates newsvendor problem for a dyadic supply chain in which both the supplier and the retailer have the preference of status-seeking with fairness concerns. Nash bargaining solution is introduced as the fairness reference point and equilibrium results are derived. The effects of fairness-concerned status-seeking behaviors on optimal decisions as well as channel efficiency are further analyzed. It is shown that the channel efficiency will decrease because of such behavioral preference. The retailer’s share will be larger when the supplier concerns fairness less, and the supplier’s sensitivity to fairness plays a relatively more important role for the channel efficiency. Additionally, another interesting managerial insight is concluded that fairness concerns will not change the status of channel coordination in certain conditions. More specifically, those contracts able (unable) to coordinate fairness-neutral supply chain, based on affine transformations with scale factors within certain ranges, still succeed (fail) to coordinate the fairness-concerned. Furthermore, several insights on bargaining powers are given as well.

Optimal emission-dependent production policy with stochastic demand

The paper addresses the issue of manufacturer’s optimal production policy under stochastic demand in an emission ‘cap and trade’ system, in which emission permit becomes another essential factor for production. Three typical sources of emission permits are considered, including emission quota allocated by the government, permits purchased via emission trading, and emission savings via purification. The emission-dependent manufacturer will balance a tradeoff to enable effective production and to determine an appropriate production scale to maximise expected profit. With these considerations in mind, two different cases of single- and multi-time purification are investigated respectively, and the optimal emission-dependent production models are proposed. Moreover, the existence and uniqueness of the optimal policy are guaranteed, and several valuable managerial insights are further concluded.

Game-theoretical analysis for supply chain with consumer preference to low carbon

This paper focuses on the impact of consumers’ preference to low carbon in the emission-concerned supply chain. In an emission-concerned supply chain, the consumers are assumed to prefer to low-carbon products. In an emission sensitive market, emission reduction not only brings the higher production costs but also stimulates the inverse demand function. Therefore, this may be an opportunity for players of the supply chain to coordinate their two objectives: environmental pressure (to reduce carbon emissions for environment protection) and profit-seeking, which intuitively seem to be contradictory. In order to address this research focus, a novel emission-sensitive demand function is adopted, and an emission -sensitive cost function is introduced explicitly to capture the deviation production cost caused by emission reduction. Then the decision-making of each member in the emission-concerned supply chain is investigated. We find that the decision-maker of the supply chain will choose different emission reduction strategies for different cases. An inspiring result shows that the channel profit as well as the emission reduction increase in the consumers’ preference to low-carbon consumption simultaneously in particular cases. Moreover, several emission-concerned contracts are designed to coordinate the channel. Another finding is that the manufacturer’s optimal carbon emissions per unit product keeps the same as the centralised channel, no matter whether the supply chain is coordinated or not. Furthermore, the further discussion reveals that less eco-friendly production than the traditional, if lack of external regulation as well as internal moral self-discipline, might be chosen under some specific conditions.

Low-carbon supply policies and supply chain performance with carbon concerned demand

A dilemma between economic growth and environmental deterioration has never been recognized so seriously until the environmental problem has been impacting everyone’s daily life cogently (e.g., the serious fog and haze in China). Simultaneously, the rising environment awareness of consumers leads to the close attention to the product’s carbon performance reflected in the carbon concerned demand, which provides opportunity to rebuild our business ecosystem. The paper expands the environment view to supply chain operations. A Stackelberg-like model is developed to game-theoretically analyze the decentralized decisions of the manufacturer and retailer. Low-carbon effort is brought into decision by both sides. The centralized decision-making is also investigated as a benchmark to evaluate the supply chain performance. Additionally,we propose a carbon-related price–discount sharing-like scheme to achieve the channel coordination and discuss the possibility of Pareto improvement. Several interesting managerial insights on low-carbon factors are concluded.

Reserving relief supplies for earthquake: a multi-attribute decision making of China Red Cross

Earthquake usually causes grievous damages especially in the earthquake prone areas. Building a fast and effective relief system is very important. China Red Cross is the largest humanitarian organizations in China. To improve its disaster response system, reserving relief supplies gets more and more attentions. In this article, a decision making programming based on the data envelopment analysis method is proposed in the construction of reserve network for China Red Cross with three factors, including cost, risk and utility. Four warehouses are selected and the optimal allocation strategies are obtained under the principles of equity and effectiveness which should be obeyed in humanitarian assistance.

Timing crisis information release via television

When and how often to release information on television are important issues in crisis and emergency risk communication. There is a lot of crisis information, including warnings and news, to which people should have access, but most of it is not significantly urgent to interrupt the broadcasting of television programmes. Hence, the right timing for the release of crisis information should be selected based on the importance of the crisis and any associated communication requirements. Using recursive methods, this paper builds an audience coverage model of crisis information release. Based on 2007 Household Using TV (HUT) data for Hefei City, China, the optimal combination of broadcasting sequence (with frequencies between one and eight times) is obtained using the implicit enumeration method. The developed model is applicable to effective transmission of crisis information, with the aim of reducing interference with the normal television transmission process and decreasing the psychological effect on audiences. The same model can be employed for other purposes, such as news coverage and weather and road information.

Dual-fairness supply chain with quantity discount contracts

This paper investigates quantity discount contracts in a dyadic supply chain that consists of one supplier and two retailers. We consider a setting in which two retailers sell a homogeneous product procured from the same supplier. The supplier sequentially offers the retailers similar quantity discount contracts by determining the optimal wholesale prices that maximize the total profits of the two games, whereas the retailers must choose the optimal retail prices to maximize their own utilities. The first retailer solely exhibits distributional fairness concern (i.e., when the payoff he receives is disproportionately smaller than that of the supplier) because he may not be aware of the second retailer’s existence. The second retailer simultaneously concerns over two types of fairness: peer-induced fairness concern (i.e., when his payoff is less than that of a peer retailer interacting with the same supplier) and distributional fairness concern; and he observes a noisy signal by which the retailer can infer the wholesale price that the supplier offered to the first retailer. This information may affect the second retailer’s decision. Equilibrium solutions under different conditions are subsequently derived. We demonstrate that this supply chain under behavioral concerns cannot be coordinated with quantity discount contracts in which the price breakpoints are dependent on the wholesale prices. Therefore, a coordination mechanism that combines quantity discount contracts with fixed fees is proposed. Furthermore, several interesting results derived from the wholesale price contracts cannot be applied to the quantity discount contracts.

Production, Manufacturing and LogisticsReciprocal supply chain with intention

The traditional hypothesis of “rationality” is far from perfect. Models of fairness solely based on consequence cannot explain why the same consequence of an action is perceived and reciprocated differently. A reciprocity model which accounts for both consequence and its underlying intention is presented in this paper to illustrate the effect of intention in a traditional dyadic channel where one supplier plays a Stackelberg-like game with one retailer. This research aims to investigate how reciprocity may affect the members’ decisions and the channel’s coordination. In this study, two scenarios are discussed: (1) the retailer has a preference for reciprocity while the supplier does not and (2) both the retailer and the supplier have a preference for reciprocity. Results for acrimonious supply chain (γμ>1) and harmonious supply chain (γμ⩽1) are analyzed. Furthermore, we derive equilibria under the two scenarios and prove the existence and the uniqueness of the equilibria. The results show that intention plays an important role in decision making of the supply chain and will significantly change the equilibria. Moreover, an acrimonious supply chain can be coordinated with a simple wholesale-price contract under certain conditions, which can never happen in a traditional channel. A harmonious supply chain, however, cannot be coordinated in any way.