Title: An analysis of firms' sustainable operations strategies: a game theory approach

Authors: Narges Kasiri; Hormoz Movassaghi

Addresses: Ithaca College, 953 Danby Road, Ithaca, NY 14850, USA ' Ithaca College, 953 Danby Road, Ithaca, NY 14850, USA

Abstract: Environmental sustainability is receiving increasing attention in industries and is manifested in various dimensions such as marketing and operations. Incorporating sustainability in operations is a strategic decision that has challenged most firms in recent years. Social trends and government regulations are important factors that play a role in influencing firms' decisions to adopt an environmentally sustainable strategy in their operations. In this paper, we develop a game theory model to mathematically analyse how these two factors can change a firm's decision from a non-sustainable to a sustainable strategy, and vice versa. We demonstrate that the model is not limited to the 'prisoner's dilemma' but also includes the games of 'harmony' and 'no-conflict'. This model helps explain firms' past sustainability behaviour and enables us to predict their future actions.

Keywords: sustainability strategies; game theory; 2 by 2 games; operations management; modelling; sustainable operations strategy; sustainable development; environmental sustainability.

DOI: 10.1504/IJMOM.2015.069220

International Journal of Modelling in Operations Management, 2015 Vol.5 No.1, pp.1 - 12

Received: 24 Jul 2014
Accepted: 20 Nov 2014

Published online: 05 May 2015 *

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