Abstract
In this paper, we consider a two-level supply chain which includes one manufacturer and one retailer. We address the problem of choosing the emission reduction through technology innovation from the manufacturer. Specifically, three options are available to manufacturer: 1) the manufacturer does not carry out the technology innovation: 2) the manufacturer carries out the technology innovation alone; 3) the manufacturer and retailer carry out the technology innovation together. We model the three options described above as systems with the manufacturer or the retailer being the leader of Stackelberg. In this case, we analyse the level of technology innovation and the retailer's cost of sales which have an impact on the profits of supply chain members. We choose a simplified numerical example and get some results. The study shows that joint innovation is not the optimum, because it is affected by the retailer's cost of sales.
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