Price Decision Analysis Based on Game Theory for Two Stages Ecological Industry Chain

The ecological industry chain is different from the conventional industry chain. Therefore, the price decisions for the conventional industry chain are not suitable for the ecological industry chain. In order to solve the price decision problem of the ecological industry chain, a two stages ecological industry chain system is took as the background. The upstream enterprise produces its main products according to the market demand and sells its byproducts (or wastes) to downstream enterprise. Price decisions of byproducts or wastes were studied based on game theory. Sequential interaction game equilibrium (Stackelberg equilibrium) and cooperative game equilibrium (coordination in price decision) were obtained. Efficiency comparisons of every decision were further analyzed. Finally, price decisions under the shortage of material situation were discussed.