Abstract This paper studies a manufacturer-dominated two-level supply chain both with risk-aversion preference by exploring the use of profit sharing contract for coordinating supply chains under the mean-variance (MV) decision framework. It is found that there exists a unique equilibrium of the Stackelberg game with profit sharing contract in the decentralized case. A numerical analysis indicates that the channel coordination is imposible in decentralization, there exisits supply chain efficiency loss under the risk-aversion assumption, the more risk-averse of the member, the less efficiency.
2012, Vol. 1 
