How to avoid source disruption of emergency supplies in emergency supply chains: A subsidy perspective

Supplier default in emergency supply chains (ESCs) is a counterintuitive idea that previous studies have ignored. Designing supply scheduling plans to standardize the emergency supplies preparedness (ESP) process and make the flow of emergency supplies more efficient has been the focus of scholars. However, source disruptions caused by supplier defaults can impede the process of standardizing ESP by paralyzing supply scheduling plans, which can increase the risk of post -disaster supply shortages. In addition, the literature has not properly addressed the lack of necessary incentives in procurement contracts used to standardize the emergency supplies preparation (ESP) process. In this paper, we first quantify supplier default in the ESC and clarify the causes of supplier default. Then, we propose two subsidy contracts with different strengths and obtain the respective performance of these subsidy contracts in reducing the possibility of supplier default. Finally, considering that most of the existing literature has been studied from the perspective of perfect rationality (i.e., decision -makers are fully aware of all information about a disaster), this paper first constructs an evolutionary game model between the government and the supplier from the perspective of bounded rationality (i.e., decisionmakers are partially aware of information about a disaster), and explores the stability of the ESC. Our results show that unthinkingly subsidizing suppliers without considering the types of supplies they pre -stocked may even increase the incentive for suppliers to default. In addition, the boundedly rational game among decision -makers can affect the ability of ESCs to respond to disasters in the later stages of relief.