Logistics outsourcing: Effects of greenwashing and blockchain technology

Abstract

In this paper, we study the logistics outsourcing strategy of a manufacturer with regard to green logistics, greenwashing, and blockchain. The manufacturer sells its products through an e-commerce platform, which has self-built logistics service. To transport the products to the customers, the manufacturer can choose to outsource this logistics service to the e-commerce platform or a third-party logistics (3PL) firm. The e-commerce platform and 3PL firm are called logistics firms in this paper. Both logistics firms consider investing in green logistics activities and may involve in greenwashing behavior. We show that outsourcing to the e-commerce platform is more beneficial for the manufacturer, no matter whether the logistics firms pursue greenwashing. Moreover, whether the logistics firms pursue greenwashing depends on both the probability that the greenwashing behavior is exposed and the corresponding penalty for greenwashing. Although adopting blockchain has the potential to prevent greenwashing, the logistics firms may still take risks to pursue greenwashing when the cost of blockchain adoption is too large. Interestingly, we find that the logistics firms will set the same green levels in logistics activities, independent of the outsourcing strategy of the manufacturer, and greenwashing decisions and blockchain adoption decisions of the logistics firms.