Using evolutionary game theory to study the layout of urban distribution centers with considering consumers' green preference

Abstract The geographical layout of urban distribution centers (DCs) affects not only the efficiency of distribution activities, but also the amount of negative externalities arising from delivery vehicles. Recently, the phenomenon of logistic sprawl has significantly reduced the social welfare as more negative externalities are produced. Government should play key role in optimizing the layout of urban DCs through incentive policy. For the first time, we apply the evolutionary game theory in controlling the layout of urban DCs with considering consumers’ green preference. We have developed a basic evolutionary game model based on static tax and subsidy to investigate the interactive mechanism between distribution enterprises (DEs) and government. Then we analyze the evolutionary behavior of DEs and government in three dynamic mechanisms: dynamic tax and static subsidy, dynamic subsidy and static tax, and dynamic tax and dynamic subsidy. Finally, a case study of optimizing the layout of DCs of Beijing is conducted. The simulation results show that the static tax and static subsidy mechanism cannot reach an evolutionary stable point, the three dynamic mechanisms can get the evolutionary stable state (ESS) effectively, in which the dynamic subsidy and static taxation is most effective for reaching the highest level of stable proportion state. In addition, we perform a sensitivity analysis to evaluate the influence of consumers' green preference on the evolutionary path of green DEs. This study can provide theoretical support for the government to formulate scientific incentive policies to guide the rational layout of urban DCs.