Abstract
We focus on the impacts of technological spillovers and environmental awareness in a two-echelon supply chain with one-single supplier and one-single manufacturer to reduce carbon emission. In this supply chain, carbon abatement investment becomes one of key factors of cutting costs and improving profits, which is reducing production costs in the components and products—the investment from players in supply chain. On the basis of optimality theory, the centralized and decentralized models are respectively established to investigate the optimal decisions and profits. Further, setting the players’ profits of the decentralized scenario as the disagreement points, we propose a bargaining-coordination contract through revenue-cost sharing to enhance the performance. Finally, by theoretical comparison and numerical analysis, the results show that: (i) The optimal profits of players and supply chain improve as technological spillovers and environmental awareness increase, and the profits of them in the bargaining-coordination contract are higher than that in the decentralized scenario; (ii) Technological spillovers between the players amplify the impact of “free-ride” behavior, in which the supplier always incentives the manufacturer to improve carbon emission intensity, but the cooperation will achieves and the profits will improve only when technological spillovers and environmental awareness are great; (iii) The contract can effectively achieve coordinated supply chain, and improve carbon abatement investment.
Highlights
From “United Nations Framework Convention on Climate Change” to “Kyoto Protocol”, and to “Copenhagen conference”, the voice of protecting environment is increasing, while the rapid growth of the world economy and continuous adjustments of economic structures are increasingly evident environmental pollution and resource shortages[1]
In terms of the effect of technological spillovers and environmental awareness on players’ production cost and market demand, we find that players will increase carbon emission intensity with the technological spillovers and environmental awareness increasing, while the product price will decrease and carbon emission intensity will increase
In terms of the effect of technological spillovers and environmental awareness on players’ marginal cost and market demand, we find that players will increase carbon emission intensity with the technological spillovers and environmental awareness increasing, while the product price will decrease and carbon emission intensity will increase
Summary
The difference between carbon emission intensity for the supplier and manufacturer on demand θ1. The positive technological spillover that the supplier receives from manufacturer’s carbon emissions intensity θ2. The positive technological spillover that the manufacturer receives from supplier’s carbon emissions intensity k
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