Decision Model of Contract-Farming Supply Chain Considering Producer’s Fairness Concerns under Random Yield

Supply chain management is critical for addressing uncertainties caused by random demand and production yield. In this study, a random yield supply chain, in which the production process of fresh agricultural products is easily affected by factors, such as weather, soil, or plant diseases and insect...

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Main Authors: Yangang Feng, Rui Chen, Lin He
Format: Article
Language:English
Published: Wiley 2022-01-01
Series:Complexity
Online Access:http://dx.doi.org/10.1155/2022/4119728
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author Yangang Feng
Rui Chen
Lin He
author_facet Yangang Feng
Rui Chen
Lin He
author_sort Yangang Feng
collection DOAJ
description Supply chain management is critical for addressing uncertainties caused by random demand and production yield. In this study, a random yield supply chain, in which the production process of fresh agricultural products is easily affected by factors, such as weather, soil, or plant diseases and insect pests, was considered. Therefore, the actual output is typically less than the planned output. A model in which the producer faces yield uncertainty was considered, and the influence of the producer’s fairness concerns on the planned output of the contract-farming supply chain was considered. Methods to motivate the producer to increase planned output through reasonable contracts were investigated. The results revealed that the producer’s fairness concern considerably influences the optimal expected profit. In the case of the random output, the planned output and maximum expected profits reduce when the farmer exhibits fairness concerns. As the degree of the producer’s fairness concern increases, the planned output and expected profit gradually decrease The cost-sharing contract can effectively encourage the producer to increase his planned output and expected utility. Finally, the results were verified numerically.
format Article
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institution Kabale University
issn 1099-0526
language English
publishDate 2022-01-01
publisher Wiley
record_format Article
series Complexity
spelling doaj-art-079c41d35e5841cbb8027509c63214b62025-02-03T05:53:35ZengWileyComplexity1099-05262022-01-01202210.1155/2022/4119728Decision Model of Contract-Farming Supply Chain Considering Producer’s Fairness Concerns under Random YieldYangang Feng0Rui Chen1Lin He2School of BusinessSchool of BusinessSchool of Information EngineeringSupply chain management is critical for addressing uncertainties caused by random demand and production yield. In this study, a random yield supply chain, in which the production process of fresh agricultural products is easily affected by factors, such as weather, soil, or plant diseases and insect pests, was considered. Therefore, the actual output is typically less than the planned output. A model in which the producer faces yield uncertainty was considered, and the influence of the producer’s fairness concerns on the planned output of the contract-farming supply chain was considered. Methods to motivate the producer to increase planned output through reasonable contracts were investigated. The results revealed that the producer’s fairness concern considerably influences the optimal expected profit. In the case of the random output, the planned output and maximum expected profits reduce when the farmer exhibits fairness concerns. As the degree of the producer’s fairness concern increases, the planned output and expected profit gradually decrease The cost-sharing contract can effectively encourage the producer to increase his planned output and expected utility. Finally, the results were verified numerically.http://dx.doi.org/10.1155/2022/4119728
spellingShingle Yangang Feng
Rui Chen
Lin He
Decision Model of Contract-Farming Supply Chain Considering Producer’s Fairness Concerns under Random Yield
Complexity
title Decision Model of Contract-Farming Supply Chain Considering Producer’s Fairness Concerns under Random Yield
title_full Decision Model of Contract-Farming Supply Chain Considering Producer’s Fairness Concerns under Random Yield
title_fullStr Decision Model of Contract-Farming Supply Chain Considering Producer’s Fairness Concerns under Random Yield
title_full_unstemmed Decision Model of Contract-Farming Supply Chain Considering Producer’s Fairness Concerns under Random Yield
title_short Decision Model of Contract-Farming Supply Chain Considering Producer’s Fairness Concerns under Random Yield
title_sort decision model of contract farming supply chain considering producer s fairness concerns under random yield
url http://dx.doi.org/10.1155/2022/4119728
work_keys_str_mv AT yangangfeng decisionmodelofcontractfarmingsupplychainconsideringproducersfairnessconcernsunderrandomyield
AT ruichen decisionmodelofcontractfarmingsupplychainconsideringproducersfairnessconcernsunderrandomyield
AT linhe decisionmodelofcontractfarmingsupplychainconsideringproducersfairnessconcernsunderrandomyield