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In this paper, we develop a multitiered dynamic global supply chain network equilibrium model in which decision-makers determine their optimal strategies for seeking to maximize their profits over the multiperiod time planning horizon. Specifically, the model consists of three tiers of decision-makers: manufacturers, retailers and consumers at different demand markets, who compete within a tier but may cooperate between tiers. In a dynamic setting, we investigate the interplay of the various decision-makers, derive their optimality conditions, establish the equilibrium conditions, and provide the finite-dimensional variational inequality formulation which is then utilized to obtain qualitative property regarding to the existence of the equilibrium model under reasonable assumptions. Finally, a numerical example is considered and discussed for illustration purpose.
Date of Conference: 21-23 Oct. 2009