Fair Distribution of Profit in Supply Chains

Most scientific publications on the subject of supply chain management only analyzewhich structures, processes and actions can contribute to value creation, oftendisregarding the distribution of profits collectively achieved in a network ofautonomous actors. Distributive justice, or fair distribution of collectively createdprofits, is one of the most important means of securing the stability of networks. Thispaper therefore presents a proposal for an operationalization of the fairness termfrom an economic perspective. This proposal is specific to the distribution of profits innetworks of autonomously acting companies. It is based on a cooperative gametheory approach, the χ-value. A practical example is used to illustrate calculation ofthe χ-value.