scholarly journals A Flexible Cap-and-Trade Policy and Limited Demand Information Effects on a Sustainable Supply Chain

2021 ◽  
Vol 13 (19) ◽  
pp. 10746
Author(s):  
Ying Gao ◽  
Jianteng Xu ◽  
Huixin Xu
Keyword(s):  
Trade Policy ◽  
Carbon Emission ◽  
Stackelberg Game ◽  
The Other ◽  
Limited Information ◽  
Low Carbon ◽  
Cap And Trade ◽  
Distribution Free ◽  
Demand Information ◽  
Limited Demand

Carbon emission reduction is increasingly becoming a public consensus, with governments formulating carbon emission policies, enterprises investing in emission abatement equipment, and consumers having a low-carbon preference. On the other hand, it is difficult for industry managers to obtain all the demand information. Based on this, this paper aims to investigate operations and coordination for a sustainable system with a flexible cap-and-trade policy and limited demand information. Newsvendor and distribution-free newsvendor models are formulated to show the validity of limited information. Stackelberg game is exploited to derive optimal abatement and order quantity solutions under centralized and decentralized systems. The revenue-sharing and two-part tariff contracts are then proposed to coordinate the decentralized system with limited demand information. Numerical analyses complement the theoretical results. We list some major findings. Firstly, we discover that using abatement equipment can effectively reduce emissions and increase profits. Secondly, the distribution-free approach is effective and acceptable for a system where only mean and variance information is informed. Thirdly, the mean parameter has a greater impact on profits and emissions comparing with the other seven parameters. Finally, we show that both contracts may achieve perfect coordination, and the two-part tariff contract is more robust.

scholarly journals Achieve a low carbon supply chain through product mix

2017 ◽  
Vol 117 (10) ◽  
pp. 2468-2484 ◽  
Author(s):  
Xu Chen ◽  
Xiaojun Wang
Keyword(s):  
Supply Chain ◽  
Trade Policy ◽  
Carbon Emissions ◽  
Channel Structure ◽  
Low Carbon ◽  
Cap And Trade ◽  
Product Mix ◽  
Content Type ◽  
Carbon Supply ◽  
Trade Offs

Purpose In the era of climate change, industrial organizations are under increasing pressure from consumers and regulators to reduce greenhouse gas emissions. The purpose of this paper is to examine the effectiveness of product mix as a strategy to deliver the low carbon supply chain under the cap-and-trade policy. Design/methodology/approach The authors incorporate the cap-and-trade policy into the green product mix decision models by using game-theoretic approach and compare these decisions in a decentralized model and a centralized model, respectively. The research explores potential behavioral changes under the cap-and-trade in the context of a two-echelon supply chain. Findings The analysis results show that the channel structure has significant impact on both economic and environmental performances. An integrated supply chain generates more profits. In contrast, a decentralized supply chain has lower carbon emissions. The cap-and-trade policy makes a different impact on the economic and environmental performances of the supply chain. Balancing the trade-offs is critical to ensure the long-term sustainability. Originality/value The research offers many interesting observations with respect to the effect of product mix strategy on operational decisions and the trade-offs between costs and carbon emissions under the cap-and-trade policy. The insights derived from the analysis not only help firms to make important operational and strategic decisions to reduce carbon emissions while maintaining their economic competitiveness, but also make meaningful contribution to governments’ policy making for carbon emissions control.

scholarly journals Pricing Strategy and Carbon Emission Abatement under Cap-and-Trade Regulation Considering Social Learning

2019 ◽  
Vol 2019 ◽  
pp. 1-17 ◽  
Author(s):  
Bin Chen ◽  
Man Yu
Keyword(s):  
Social Learning ◽  
Carbon Emission ◽  
Pricing Strategy ◽  
High Price ◽  
Low Carbon ◽  
Cap And Trade ◽  
Carbon Product ◽  
Trade Regulation ◽  
Emission Abatement ◽  
Period 2

In an uncertainty market, social learning plays a significant role in obtaining information to make better decisions. Under cap-and-trade regulation, this paper aims to investigate firms’ pricing and carbon emission abatement issues considering the impact of social learning. This paper establishes a two-period model in a market consisting of a manufacturer and heterogeneous consumers. The manufacturer produces two alternatives (ordinary product and low-carbon product) and makes decisions on sales prices and carbon emission abatement levels. Consumers make decisions on whether and which product to buy. Consumers are not sure about their valuations of products and have the opportunity to discover their true valuation by social learning. The results show that the emission abatement level on ordinary product is affected by the pricing strategy for both types of products. However, the emission abatement level on low-carbon product is only affected by its own pricing strategy. It also shows that social learning lowers the emission abatement level on ordinary product, whereas it improves the emission abatement level on low-carbon product when charging a high price for low-carbon product. Moreover, the price of ordinary product in period 1 is no less than that in period 2. In contrast, the price of low-carbon product in period 2 is higher than that in period 1.

scholarly journals Profit Distribution Model for Construction Supply Chain with Cap-and-Trade Policy

2019 ◽  
Vol 11 (4) ◽  
pp. 1215 ◽  
Author(s):  
Wen Jiang ◽  
Wenfei Lu ◽  
Qianwen Xu
Keyword(s):  
Supply Chain ◽  
Trade Policy ◽  
Emission Reduction ◽  
Carbon Emission ◽  
Cap And Trade ◽  
Carbon Emission Reduction ◽  
Profit Distribution ◽  
General Contractor ◽  
Cost Coefficient ◽  
Pure Competition

Cap-and-trade has become one of the most widely used carbon emission limitation methods in the world. Its constraints have a great impact on the carbon emission reduction decisions and production operations of supply chain enterprises, as well as profit distribution. In the construction supply chain, there are few studies on the profit distribution and emission reduction decisions considering cap-and-trade policy. This paper investigates the profit distribution model of a two-echelon construction supply chain consisting of a general contractor and a subcontractor with cap-and-trade policy. Using game theory and Shapley value method, the optimal emission reduction decisions and profit distribution under three cooperation modes of pure competition, co-opetition, and pure cooperation are obtained, respectively. The research shows that the profits of the construction supply chain are increasing in pure competition, co-opetition, and pure cooperation scenarios, and the emission reduction amount of the construction supply chain in the case of pure cooperation is greater than that of pure competition and co-opetition. The carbon emission reduction amount under the co-opetition scenario is not always greater than that under the pure competition scenario, which depends on the emission reduction cost coefficient relationship of general contractor and subcontractor. When the cost coefficient of emission reduction of the general contractor is less than that of the subcontractor, the emission reduction amount under pure competition is larger than that under co-opetition. A numerical study is carried out to verify the conclusions and illustrated the profits of the supply chain decreased with the increase of carbon emission reduction cost coefficient, and had nothing to do with the emission reduction efficiency of enterprises.

scholarly journals Optimal Pricing, Ordering, and Coordination for Prefabricated Building Supply Chain with Power Structure and Flexible Cap-and-Trade

Mathematics ◽  
2021 ◽  
Vol 9 (19) ◽  
pp. 2426
Author(s):  
Wen Jiang ◽  
Menglin Liu ◽  
Lu Gan ◽  
Chong Wang
Keyword(s):  
Supply Chain ◽  
Emission Reduction ◽  
Carbon Emission ◽  
Power Structure ◽  
Supply Chain Performance ◽  
Low Carbon ◽  
Cap And Trade ◽  
Power Structures ◽  
Carbon Emission Reduction ◽  
Prefabricated Building

Under the increasing pressure of global emission reduction, prefabricated buildings are becoming more and more popular. As prefabricated building manufacturers and assemblers are emerging in the market, how do they make decisions of pricing, ordering, and emission reduction? In this paper, game theory is used to make the decisions for the prefabricated building supply chain with flexible cap-and-trade and different power structures, i.e., using prefabricated building manufacturers as the leader, using the vertical Nash equilibrium, and using prefabricated building assemblers as the leader. The two-part tariff contract is designed to coordinate the supply chain and to improve the supply chain performance. Moreover, we discuss the influence of different power structures and the two-part tariff contract on the optimal decisions and profits. Finally, numerical analysis is used to verify the conclusions. This indicates that the supply chain leaders will gain a higher profit and that the power structure has a significant influence on the two-part tariff contract, which will result in an unfair distribution of profit. High carbon trading prices benefit carbon emission reduction. Consumer low-carbon awareness has a positive effect on carbon emission reduction and supply chain performance.

scholarly journals Low carbon warehouse management under cap-and-trade policy

2016 ◽  
Vol 139 ◽  
pp. 894-904 ◽  
Author(s):  
Xu Chen ◽  
Xiaojun Wang ◽  
Vikas Kumar ◽  
Niraj Kumar
Keyword(s):  
Trade Policy ◽  
Low Carbon ◽  
Cap And Trade ◽  
Warehouse Management

Stackelberg game based co-firing biomass with coal under carbon cap-and-trade regulation

2021 ◽  
pp. 0958305X2110415
Author(s):  
Zongtang Xie ◽  
Hongxia Liu
Keyword(s):  
Emission Reduction ◽  
Power Plants ◽  
Carbon Emission ◽  
Stackelberg Game ◽  
Cap And Trade ◽  
Carbon Emission Reduction ◽  
Trade Regulation ◽  
Social Welfare Maximization ◽  
Emission Quota ◽  
Interactive Algorithm

Coal-fired power industry is under enormous pressure to accomplish carbon emission reduction targets. This paper proposes a bi-level multi-objective model for co-firing biomass with coal under carbon cap-and-trade regulation which considers a leader-follower Stackelberg game between the authority and the coal-fired power plants. The upper level regards social welfare maximization and allocation satisfaction maximization as its multiple objectives, while the lower level attempts to maximize the profits of each coal-fired power plant. The inherent uncertainty prompts the motivation for employing fuzzy set theory to characterize the uncertain parameters and determine their exact values. A case study from Shandong Province, China is provided to demonstrate the practicality and efficiency of the optimization model. [Formula: see text]-constraint method and interactive algorithm are used to solve the model, and furthermore the solutions associated with different free carbon emission quota levels and minimal allocation satisfactions have been generated to examine the influences. Based on the analysis and discussion, the methodology can meet the carbon emission reduction goals and transit to a lower-carbon power generation. It also assists the decision makers to develop desired quota allocation strategy in accordance with their attitudes and actual conditions.

scholarly journals Impact of Asymmetric Carbon Information on Supply Chain Decisions under Low-Carbon Policies

2016 ◽  
Vol 2016 ◽  
pp. 1-16 ◽  
Author(s):  
Lei Yang ◽  
Jingna Ji ◽  
Chenshi Zheng
Keyword(s):  
Supply Chain ◽  
Tax Policy ◽  
Carbon Emission ◽  
Stackelberg Game ◽  
Carbon Tax ◽  
Emission Trading ◽  
Low Carbon ◽  
High Carbon ◽  
Allocation Mechanism ◽  
Asymmetric Carbon

Through the establishment of the leading manufacturer Stackelberg game model under asymmetric carbon information, this paper investigates the misreporting behaviors of the supply chain members and their influences on supply chain performance. Based on “Benchmarking” allocation mechanism, three policies are considered: carbon emission trading, carbon tax, and a new policy which combined carbon quota and carbon tax mechanism. The results show that, in the three models, the leader in the supply chain, even if he has advantages of carbon information, will not lie about his information. That is because the manufacturer’s misreporting behavior has no effect on supply chain members’ performance. But the retailer will lie about the information when he has carbon information advantage. The high-carbon-emission retailers under the carbon trading policy, all the retailers under the carbon tax policy, and the high-carbon-emission retailers under combined quotas and tax policy would like to understate their carbon emissions. Coordination of revenue sharing contract is studied in supply chain to induce the retailer to declare his real carbon information. Optimal contractual parameters are deduced in the three models, under which the profit of the supply chain can be maximized.

Sign in / Sign up

Export Citation Format

Share Document