A Manufacturer-Retailer Stackelberg Game of Innovation Pricing

Nowadays the corporations must make the proper pricing strategy because of the competition for maximizing their profit.This paper attempts to investigate the optimal dynamic pricing strategy of a manufacturer-retailer supply chain.Some outcomes are obtained based on a Stackelberg game model,such as the manufacturer's optimal strategy is fixed over time horizon on the condition of the Stackelberg game while the manufacturer is the leader;and the cumulative sales is a linear function of the time etc,these outcomes accord with the reality.