Carbon Emission Reduction and Pricing Decisions of Dual-Channel Closed-Loop Supply Chain with Fairness Concern Under Carbon Tax Policy

Abstract

Considering a dual channel closed-loop supply chain composed of a manufacturer and a retailer, and the retailer establishes online direct channels, four Stackelberg game models are constructed to study the impact of carbon tax and different fairness concerns of supply chain members on the optimal strategies, such as carbon emission reduction level, recycling and pricing decisions etc. The results show that the fairness concerns of supply chain members does not affect the recycling decision of manufacturer, but increasing carbon tax will promote the manufacturer to recycle more used products to reduce carbon emissions through remanufacturing. When the retailer has fairness concern but the manufacturer ignores it, with the increase of the retailers' fairness concern, the online selling price, the retail price and the retailers' utility increase while the manufacturers' profit decreases. When the manufacturer considers retailers' fairness concern, there will be more carbon emissions in the supply chain. Manufacturer should pay attention to this fairness concern and take certain measures to prevent this behavior. Compared with fairness neutrality, whether one or both of supply chain members have fairness concerns, it will inhibit manufacturers' enthusiasm for carbon reduction investment. When both of them have fairness concerns, the higher the manufacturers' fairness concern, the lower the carbon emission reduction level is.