A Research on Distributed Supply Chain Coordination Based on Golden Rule

Abstract

Under the target hypothesis of Golden Rule, the distributed supply chain which consists of one manufacturer and two retailers is considered. The bi-level programming is applied to construct a distributed supply chain coordination model in order to analyze the coordination mechanism, and the relation between the collective Pareto optima and the degree of mutual interest among enterprises on the supply chain is discussed. The conclusion shows that the collective Pareto optima can be realized only when the manufacturer and the retailers are concerning about the interests of themselves and others equally.