Dynamic analysis of supplier and retailer coordination based on asymmetric rationality

In this paper, we develop degenerative earning matrixes under asymmetric rationality in accordance with the characteristics of integrated optimization. Our objectives are to gain replicator dynamics for integrated optimization, solve the ESS, and then analyze the parameters´ effects on replicator dynamics and evolutionary stability strategy. The results show that bounded rational retailers´ strategies depend on the selection of completely rational suppliers and retailers´ profit share of in integrated optimization. When the profit share in integrated optimization is greater than in an individual optimization, all retailers will eventually adopt the integrated optimization strategy. When the profit share in integrated optimization is smaller than in an individual optimization, all retailers will adopt the individual optimization strategy. This means that the ESS of bounded rational retailers with incomplete information is the same as the selections of complete rational retailers with perfect information.