Coordinating a Supply Chain with a Loss-Averse Retailer and Effort Dependent Demand

Table 1

Optimal results of the integrated and decentralized systems.

Model type	Effort level	Order quantity	Retailer’s profit	Manufacturer’s profit	System profit	Δ (% profit increase)
Decentralized	11.1	529	496	2115	2611	2381.8
Integrated	180.0	43200	26782	38018	64800	—