Abstract
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.
Highlights
(4) We extend the distribution-free newsvendor model with limited demand information considered in the literature to those with consumer low-carbon preference and carbon emission policies
This paper focuses on a two-echelon sustainable supply chain of a retailer and a manufacturer, where the manufacturer is the main generator of carbon emissions
Our research has revisited the two-echelon sustainable supply chain, considering the government, enterprise, and consumer based on a consistent goal of reducing carbon emissions
Summary
Publisher’s Note: MDPI stays neutral with regard to jurisdictional claims in published maps and institutional affiliations. Based on the above background, it is necessary to rethink the operation and coordination of a sustainable supply chain with the carbon emission policy and the limited demand information. Our work aims to fill these gaps by trying to address the following management issues as follows: (1) Under a sustainable system in which the government implements the flexible C&T policy, the enterprise actively invests in abatement investment, and the consumer has a low-carbon preference. (4) We extend the distribution-free newsvendor model with limited demand information considered in the literature to those with consumer low-carbon preference and carbon emission policies.
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