Evolutionary game analysis and regulatory strategies for online group-buying based on system dynamics. Issue 6 (3rd July 2018)

• Record Type: Journal Article
• Authors: Jiang, Zhong-Zhong; He, Na; Qin, Xuwei; Ip, W.H.; Wu, C.H.; Yung, K.L.
• Is Part Of: Enterprise information systems. Volume 12:Issue 6(2018)
• Page Start: 695
• Page End: 713
• Publication Date: 2018-07-03
• Subjects: Online group-buying -- bounded rationality -- three-parties evolutionary game -- system dynamics -- regulatory strategies; Information storage and retrieval systems -- Periodicals; Management information systems -- Periodicals; Electronic commerce -- Periodicals; 658.4038011
• DOI: 10.1080/17517575.2017.1412503
• Languages: English
• ISSNs: 1751-7575

Abstract

ABSTRACT: The emergence of online group-buying provides a new consumption pattern for consumers in e-commerce era. However, many consumers realize that their own interests sometimes can't be guaranteed in the group-buying market due to the lack of being regulated. This paper aims to develop effective regulation strategies for online group-buying market. To the best of our knowledge, most existing studies assume that three parties in online group-buying market, i.e. the retailer, the group-buying platform and the consumer, are perfectly rational. To better understand the decision process, in this paper, we incorporate the concept of bounded rationality into consideration. Firstly, a three-parties evolutionary game model is established to study each player's game strategy based on bounded rationality. Secondly, the game model is simulated as a whole by adopting system dynamics to analyze its stability. Finally, theoretical analysis and extensive computational experiments are conducted to obtain the managerial insights and regulation strategies for online group-buying market. Our results clearly demonstrate that a suitable bonus-penalty measure can promote the healthy development of online group-buying market.