Environmentally Friendly Supplier Selection Using Prospect Theory
AbstractThis paper proposes an optimal selection method to address the real-world problem of environmentally friendly supplier selection, based on prospect theory. This study adopted the manufacturer’s point of view, and considered the manufacturer’s psychological and behavioral factors in the process of choosing suppliers. The first step was to build supplier-selection indexes for manufacturers. Then, the study assessed the attribute of manufacturer expectations as a reference point. Next, index gains and losses were evaluated against the expectation reference point, yielding a payoff matrix and loss matrix. Finally, the study used prospect theory to calculate the comprehensive prospect value of each supplier; comprehensive prospect values were sorted in descending order to help manufacturers make the best choice. View Full-Text
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Song, W.; Chen, Z.; Wang, X.; Wang, Q.; Shi, C.; Zhao, W. Environmentally Friendly Supplier Selection Using Prospect Theory. Sustainability 2017, 9, 377.
Song W, Chen Z, Wang X, Wang Q, Shi C, Zhao W. Environmentally Friendly Supplier Selection Using Prospect Theory. Sustainability. 2017; 9(3):377.Chicago/Turabian Style
Song, Wei; Chen, Zhiya; Wang, Xuping; Wang, Qian; Shi, Chenghua; Zhao, Wei. 2017. "Environmentally Friendly Supplier Selection Using Prospect Theory." Sustainability 9, no. 3: 377.