Abstract
AbstractWe examine a supply chain where a supplier produces partial substitutable green and non‐green products and sell them in a common market through a buyer. We analyse four scenarios: wholesale price and linear two‐part tariff contracts under full and incomplete information about the buyer's unit cost. Our result demonstrates that the value of information and trade cutoff points both increase with consumer greening sensitivity and decrease with greening investment. When green product market share exceeds a certain threshold, demand for the green product would be higher than non‐green product, even when green product is priced higher in the end market.
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