Designing a Bi-Level Planning Model in Order to Provide Financial Incentives for Job Creation in the Sustainable Supply Chain Network, Taking Into Account Uncertainty

Abstract

Designing supply chain networks has become a significant managerial concern, with a shift towards considering social and environmental aspects alongside economic performance. This study proposes a decentralized, bi-level program to optimize the network of supply chains sustainably. The proposed model involves two decision-makers: the supply chain owners as followers and the government as the leader. The government aims to maximize job creation, while the supply chain owners strive to minimize operation and environmental impact costs by using financial incentives. Their collaboration improves the national employment situation as well as the logistics structure of the supply chain. The study also addresses uncertainties in product markets using a robust planning model with parameters set within specific intervals. Meta-heuristic algorithms are used for efficiency since the problem is NP-hard. The study develops an iterative algorithm based on complete counting to find the Stackelberg equilibrium point. Numerical results demonstrate the efficiency and applicability of the proposed heuristic algorithm, providing a valuable approach to sustainable supply chain network design.

Keywords

• Bi-level programming
• job creation
• sustainable supply chain network design
• uncertainty