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Supply chain coordination considering loss aversion and fairness concern under revenue

Author(s): Ying Dai1,Yanhong Qin1,*, Han Song1, Yanqin Li2

The impacts of the loss aversion and fairness concern of retailer on the relative decision of retailer and supply chain are analyzed. When the loss aversion and fairness concern of retailer is considered, the revenue sharing contract still can coordinate the supply chain. Then, the optimal order quantity of retailer and supply chain will decrease as loss aversion increase, but the changing trend of the optimal order quantity caused by fairness concern depends on the coefficient of revenue sharing, and the changing degree of optimal quantity of retailer is more obvious than that of supply chain.

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