Optimizing inventory level and technology investment under a carbon tax, cap-and-trade and strict carbon limit regulations

2021 ◽  
Vol 25 ◽  
pp. 604-621
Author(s):  
Md. Rakibul Hasan ◽  
Tutul Chandra Roy ◽  
Yosef Daryanto ◽  
Hui-Ming Wee
Keyword(s):  
Carbon Tax ◽  
Inventory Level ◽  
Cap And Trade ◽  
Technology Investment ◽  
Tax Cap

scholarly journals Effect of Carbon-tax and Cap-and-trade mechanism on an inventory system with price-sensitive demand and preservation technology investment

2020 ◽  
Vol 30 (3) ◽  
pp. 361-380
Author(s):  
Aditi Khanna ◽  
Shikha Yadav ◽  
P Priyamvada
Keyword(s):  
Carbon Emissions ◽  
Carbon Tax ◽  
Sensitivity Analyses ◽  
Selling Price ◽  
Cap And Trade ◽  
Technology Investment ◽  
Preservation Technology ◽  
Total Profit ◽  
Inventory Holding ◽  
Carbon Control

In today's global decision-making context, government and organizations are highly concerned with environmental degradation caused by carbon emissions. Being environmental conscious, this paper investigates two different carbon policies viz., ?Carbon tax and Cap-and-trade mechanism". It is observed that the main sources of carbon emissions are transhipments, inventory holding, inventory deterioration, and its preservation. Demand for the item is considered to be selling price dependent. Further, a comparison between a ?carbon tax" and \cap-and-trade" policies has been illustrated. Some important managerial insights are obtained from numerical and sensitivity analyses. The present paper contributes to the existing literature of carbon control policies by developing optimal inventory models dealing with deteriorating items with preservation technology. Results suggest that firms should implement ?Cap-and-trade" policy to increase their total profit, which at the same time, will help in reducing the carbon emissions.

scholarly journals Carbon tax or cap-and-trade: Which is more viable for Chinese remanufacturing industry?

2020 ◽  
Vol 243 ◽  
pp. 118606 ◽  
Author(s):  
Xu Hu ◽  
Zhaojun Yang ◽  
Jun Sun ◽  
Yali Zhang
Keyword(s):  
Carbon Tax ◽  
Cap And Trade

scholarly journals A Production Inventory Model for Deteriorating Items with Collaborative Preservation Technology Investment Under Carbon Tax

2019 ◽  
Vol 11 (18) ◽  
pp. 5027 ◽  
Author(s):  
Shen ◽  
Shen ◽  
Yang
Keyword(s):  
Greenhouse Gas Emissions ◽  
Greenhouse Gas ◽  
Carbon Emissions ◽  
Carbon Tax ◽  
Inventory Model ◽  
Gas Emissions ◽  
Technology Investment ◽  
Preservation Technology ◽  
Production Inventory ◽  
Preservation Technology Investment

The increase in carbon emissions is considered one of the major causes of global warming and climate change. To reduce the potential environmental and economic threat from such greenhouse gas emissions, governments must formulate policies related to carbon emissions. Most economists favor the carbon tax as an approach to reduce greenhouse gas emissions. This market-based approach is expected to inevitably affect enterprises’ operating activities such as production, inventory, and equipment investment. Therefore, in this study, we investigate a production inventory model for deteriorating items under a carbon tax policy and collaborative preservation technology investment from the perspective of supply chain integration. Our main purpose is to determine the optimal production, delivery, ordering, and investment policies for the buyer and vendor that maximize the joint total profit per unit time in consideration of the carbon tax policy. We present several numerical examples to demonstrate the solution procedures, and we conduct sensitivity analyses of the optimal solutions with respect to major parameters for identifying several managerial implications that provide a useful decision tool for the relevant managers. We hope that the study results assist government organizations in selecting a more appropriate carbon emissions policy for the carbon reduction trend.

Carbon tax versus cap-and-trade

2009 ◽  
Vol 18 (4) ◽  
pp. 95-100 ◽  
Author(s):  
Jim DiPeso
Keyword(s):  
Carbon Tax ◽  
Cap And Trade

scholarly journals COMBINING MULTIPLE CLIMATE POLICY INSTRUMENTS: HOW NOT TO DO IT

2010 ◽  
Vol 01 (03) ◽  
pp. 209-225 ◽  
Author(s):  
SAMUEL FANKHAUSER ◽  
CAMERON HEPBURN ◽  
JISUNG PARK
Keyword(s):  
Climate Change ◽  
Carbon Tax ◽  
Climate Change Policy ◽  
Policy Instruments ◽  
Carbon Price ◽  
Reserve Price ◽  
Cap And Trade ◽  
Change Policy ◽  
Hybrid Instruments ◽  
Carbon Prices

Putting a price on carbon is critical for climate change policy. Increasingly, policymakers combine multiple policy tools to achieve this, for example by complementing cap-and-trade schemes with a carbon tax, or with a feed-in tariff. Often, the motivation for doing so is to limit undesirable fluctuations in the carbon price, either from rising too high or falling too low. This paper reviews the implications for the carbon price of combining cap-and-trade with other policy instruments. We find that price intervention may not always have the desired effect. Simply adding a carbon tax to an existing cap-and-trade system reduces the carbon price in the market to such an extent that the overall price signal (tax plus carbon price) may remain unchanged. Generous feed-in tariffs or renewable energy obligations within a capped area have the same effect: they undermine the carbon price in the rest of the trading regime, likely increasing costs without reducing emissions. Policymakers wishing to support carbon prices should turn to hybrid instruments — that is, trading schemes with price-like features, such as an auction reserve price — to make sure their objectives are met.

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