An evolutionary analysis of supply chain collaborative information sharing based on prospect theory

Abstract

In order to delve into the dynamic evolution process and influencing factors of information sharing decisions among stakeholders under supply chain collaboration, this study constructs an evolutionary game model with suppliers and retailers as the primary entities. Within this model, a combined approach of game theory and prospect theory is employed, integrating prospect value functions and weight functions to create an information sharing prospect value matrix. A comprehensive analysis is conducted on the strategic choices and benefits of entities considering the psychological perception of information sharing, and critical factors influencing the stability of information sharing evolution results are explored through numerical simulations using Matlab. The key findings of this study are as follows: Firstly, from the perspective of supply chain collaboration, the probability of entities evolving into information sharing is negatively correlated with the cost of information sharing and positively correlated with the benefits generated by information coordination. Secondly, looking at supply chain collaboration, entities are more likely to engage in information sharing behavior when they exhibit a lower level of risk aversion, indicating greater rationality, when facing profits; conversely, they are more likely to participate in information sharing when they display a higher degree of risk preference, indicating less rationality, in the face of losses. Furthermore, the lesser sensitivity of suppliers and retailers to losses is more likely to drive the system towards an information-sharing state. Based on the primary findings mentioned above, this study offers recommendations for enhancing trust, constructing information exchange platforms, and adjusting psychological awareness. These suggestions contribute to improving information sharing among entities within the supply chain, thus enhancing the overall efficiency and collaboration of the supply chain.