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Chinese Journal of Management Science ›› 2014, Vol. 22 ›› Issue (8): 90-99.

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Fairness’s Influences to the Retailer’s Ordering Decision

LI Juan, ZHANG Di, SHEN Hou-cai   

  1. School of Management and Engineering, Nanjing University, Nanjing 210093, China
  • Received:2012-08-01 Revised:2013-05-12 Online:2014-08-20 Published:2014-08-23

Abstract: The retailer's fairness concerning influences the ordering decision in the supply chain. Types of fairness are divided as: two-sides process fairness, two-sides outcome fairness, one-side process fairness and one-side outcome fairness. In this paper, how fairness concerning influences the retailer's optimal ordering decisions under wholesale price contract is investigated. Firstly, given the wholesale price contract, when the retailer concerns about two-sides fairness, the optimal ordering decision under process fairness is different from that under outcome fairness. The comparison of the optimal ordering decisions between that with fairness concerning and that without depends on the system's parameters. His fairness concerning cannot coordinate the supply chain, but it can improve his relative profits under some conditions. Secondly, given the wholesale price contract, when the retailer concerns about one-side fairness, the optimal ordering decision with process fairness is smaller than that without and the optimal ordering decision with outcome fairness is larger than that without under some conditions. His fairness concerning cannot coordinate the supply chain, but he can improve his relative profits under some conditions.

Key words: two-sides process fairness, two-sides outcome fairness, one-side process fairness, one-side outcome fairness

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