Journal of Korean Society of Industrial and Systems Engineering (산업경영시스템학회지)

Society of Korea Industrial and System Engineering (한국산업경영시스템학회)
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Game Theoretic Analysis of the Price and Quality Strategy of a Private Brand Product

게임이론을 이용한 자체브랜드 제품의 가격 및 품질전략 분석

  • Cho, Hyung-Rae (Dept. of Industrial Systems Engineering, Gyeongsang National University) ;
  • Rhee, Min-Ho (Dept. of Industrial Systems Engineering, Gyeongsang National University)
  • 조형래 (경상대학교 공과대학 산업시스템공학부) ;
  • 이민호 (경상대학교 공과대학 산업시스템공학부)
  • Received : 2011.06.10
  • Accepted : 2011.09.05
  • Published : 2011.09.30
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Abstract

Recently, the increasing power of distributors has given them the opportunity of introducing private brand (PB) products. Based on the game theory, this study analyzes the decision making of a distributor regarding the optimal pricing and quality strategies for the PB product. By analyzing the game model, it is shown that the pricing mechanism heavily depends not only on the market power of the distributor but on the quality of the PB product. It is also shown that, counter intuitively, as the market power of the distributor increases, the optimal quality of the PB product should be decreased.

Keywords

Acknowledgement

Supported by : 경상대학교

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