In this paper, we develop a game theoretic model for cooperative advertising in a supply chain consisting of a … expenditures. To identify optimal advertising and pricing decisions, we discuss three possible games (two non cooperative games … of the demand function which is an additive form. The demand is influenced by both retail price and advertising …

price discount, retailer’s price discount, and local advertising expense. For the special case of two-stage equilibrium when … the manufacturer’s price discount is exogenous, we found that the retailer is willing to increase local advertising … expense if the manufacturer increases local advertising allowance and provides deeper price discount, or if the manufacturer …