Journal
TRANSPORTATION RESEARCH PART E-LOGISTICS AND TRANSPORTATION REVIEW
Volume 144, Issue -, Pages -Publisher
PERGAMON-ELSEVIER SCIENCE LTD
DOI: 10.1016/j.tre.2020.102154
Keywords
Supply Chain; Decoy Effect; Asymmetrically Dominated Effect; Decision Modeling; Simulation
Categories
Funding
- Natural Science Foundation of China [71572070,720720731]
- Fundamental Research Funds for the Central Universities [Jinan University] [15JNQM003]
- Guangdong Planning Foundation of Philosophy and Social Sciences, China [GD2OCGL20]
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Internet shortens the distance between consumers and firms in a supply chain and facilitates firms to consider consumers' behaviors when making business decisions. In this paper, we study the decoy effect on firms' product proposition decisions under various circumstances. The decoy effect is the phenomenon whereby consumers change their preference between two options when presented with a third option that is less desirable. We examine the product propositions in a competitive supply chain adopting decoy effect from the perspectives of a high-end firm or a lowend firm, respectively. We also investigate impacts of consumers' behavioral factors on the decoy effect, such as rationality, social influence, and loss-aversion preference. Further, we test whether decoys can be as effective online as they are offline, and effective in a monopolistic supply chain as well. A multi-agent system is built to conduct simulations.
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