The signaling game model under asymmetric fairness-concern information

Under the wholesale price contract, we analyze the influence of the retailer’s fairness-concern information on the wholesale price, order quantity, the profit of each party and the supply chain in symmetry information (SI) condition and asymmetry information (AI) condition respectively. Then, we compute the value of retailer’s fairness-concern information to supplier, and we prove that the profit of all members and supply chain is decreasing with retailer’s fairness concern and the profit in SI condition is always higher than that in the AI condition. Then, we set the signaling game model to reveal the transmission mechanism of retailer’s fairness-concern information, and we analyze the potential separating equilibrium and pooling equilibrium existing in signaling model under asymmetric fairness-concern information. We prove that only when the signal transmission cost is different between retailers with different fairness-concern degree, the signaling model can effectively reveal the role and type of retailers. Finally, we provide some suggestions improve fairness-concern information transmission and optimize supply chain operation by discussing the condition of each separating equilibrium results.