A Game Theoretic Approach for Greening, Pricing, And Advertising Policies in A Green Supply Chain

In this paper, greening, pricing, and advertising policies in a supply chain will be examined with government intervention. The supply chain has two members. First, a manufacturer seeking to determine the wholesale price and the greening level and second, a retailer that has to determine the advertising cost and the retail price. The government is trying to encourage the manufacturer to green the production using subsidies. Using the game theory, at first, the demand function and the profit functions of both members are introduced, then in a dynamic game, their Stackelberg equilibrium is calculated. Sensitivity and parameter analysis are made to more illustration of the problem. We found the supply chain profit function behavior and results show that if the sensitivity of demand-price is less than a specific value, the manufacturer will not participate in greening policies.