Game theoretical analysis and decision models in sustainable supply chain management

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This proposal aims to employ game theoretic analysis and decision models to investigate several challenging operational issues in sustainable supply chain management. In the current business environment, pressures from government, competitors, and customers make it essential for firms to provide environmentally-friendly and green product to reduce their environmental footprint. As a result, the concept of sustainable supply chain management has gained increasing popularity among academia and business practitioners. However, there exist many barriers to successful implementation of sustainable operations in a supply chain. For instance, sustainable operations generally involve non-economic considerations by supply chain members such as fairness concerns and social preference. It is a challenge to properly characterize these economically irrational criteria and design appropriate contracts to coordinate supply chain operations. A firm's investment in sustainability typically represents a significant cost centre and other members in the supply chain will also benefit from it. Then, it is important to establish a fair allocation mechanism to share the cost among the member firms so that sustained investment can be committed to promoting sustainable supply chain management. It is an important challenge to evaluate the effectiveness and fairness of different regulation and policy choices for sustainable development from different supply chain stakeholders' perspectives.This proposal aims to address challenging sustainable operations issues in supply chain management from the following four directions: (1) The first component is to develop game-theoretic models to characterize the interactions of supply chain members under non-economic criteria such as fairness concerns, reciprocity, and social preference in sustainable supply chain management. (2) The second component is to devise social and environmental responsibility allocation schemes in sustainable supply chain management. (3) The third component is to put forward effective frameworks to evaluate economic and social performance of sustainable supply chain management under different regulation and legislation regimes. (4) The fourth component is to establish cooperative game models for coordinating sustainable supply chain management. A successful execution of the proposed research will furnish useful tools to better understand and implement sustainable operations of supply chains.