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The author: Lyubyashenko S.     Published in № 6(96) 31 december 2023 year
Rubric: The practice of entrepreneurship in a competitive environment

Modeling the Operation of a Technological Chain with Vertical and Horizontal Relationships of Participants and Taking into Account Demand

The subject of the article is the study of production structures consisting of a set of independent firms (enterprises interacting with each other through the supply of products through horizontal and vertical links in a single production and technological chain. It is assumed that firms at different levels of the chain not only supply components up, but also sell them on the market, organizing interaction with wholesale buyers. The mechanism of interaction takes into account economic interests, the demand for the company’s products in the market and reflects the situation of equilibrium. The scientific novelty of the study is the deepening of the methodological basis for describing the interaction of participants in the technological chain using matrix modeling based on the principles of constructing matrices of intersectoral balance. Such characteristics of firms and the system as a whole as: final product, gross product, resource volumes are considered. On the basis of the obtained final formulas, the dependences of the economic characteristics of the activity of firms and the system as a whole on the decrease (increase) in prices for resources, on changes in demand are established. The proposed approach to determining the final product of the system seems to be quite reasonable: firstly, the output volumes of the system are linked through the interaction of the manufacturer and seller, taking into account market demand, and, secondly, the volume of sales reflects the economic interests of the parties. The ratio “the price of products on the market – the volume of supply” becomes justified on the part of the demand function (the end consumer), the seller and the manufacturer of products. Such an optimization approach to determining the results of interaction promptly takes into account changes in the market environment and adjusts the performance indicators of participants in the direction of their consistency, which makes it possible to increase the stability of the system. It is established that when the market situation worsens as a result of rising prices for factors of production or a reduction in effective demand, there is a percentage decrease in final output in value terms, but the rate of its reduction is lower. The case of a decrease in demand has a more negative impact on the economy of the firm and the entire system. Thus, the growth rates of the economy and the well-being of the population are determined by the efficiency of complex hierarchical structures with horizontal and vertical relationships.

Key words

technological chain, horizontal and vertical relationships, matrix modeling, final product, gross product, resource price, demand

The author:

Lyubyashenko S.

Degree:

Cand. Sci. (Econ.), Associate Professor, Economic Theory Department, Novosibirsk State University of Economics and Management (NSUEM)

Location:

Novosibirsk, Russia