Effects of government subsidy programs on job creation for sustainable supply chain management

Abstract

Concerns regarding the environment and society have inspired several studies on sustainable supply chain management. These studies typically consider that enterprises are motivated by incentives such as subsidies. Consequently, these studies have developed various optimization models based on the positive aspects of such incentives. However, many social science studies argue that subsidies are not always effective. Here, to clarify the relationships between sustainable supply chains and subsidies, we developed mixed-integer linear programming models, considering various subsidy programs, for sustainable supply chain design. The solutions of our numerical experiments on these models provided important managerial insights. We found each subsidy program has significantly different outcomes in terms of job quality and quantity. Further, a fixed subsidy program for supply chains is more effective than other programs.