Abstract
Global warming has become an issue of increasing worldwide concern. At present, the most direct way to solve this problem is to control carbon emissions. In our paper, carbon tax policy is injected into a two-stage supply chain consisting of one manufacturer and two retailers. We establish six game models according to the relationship (competitive or cooperative) between the retailers and three power structures (manufacturer Stackelberg (MS), retailer Stackelberg (RS), and vertical Nash (VN)) between the two retailers and the manufacturer. We then adopt the inverse induction method to derive optimal pricing decisions for each model. Optimal profits for supply chain members are obtained. Finally, we analyse: i) the effects of competition and cooperation between the two retailers on equilibrium results; ii) the effects of the three possible power structures existing between the manufacturer and the two retailers on equilibrium results; and especially iii) the effect of the carbon tax rate on pricing decision and the profits of the supply chain. We find that the different power structure and the horizontal relationship between the two retailers have important influence on equilibrium results. Further, the change of carbon tax rate have different influence on pricing under the different power structure and the horizontal relationship between the two retailers. When the government adjusts the carbon tax rate, it should fully consider the different power structure and the horizontal relationship for two-stage supply chain consisting of one manufacturer and two retailers. Although the implementation of the carbon tax policy reduces the corporate profits, it reduces the total carbon emission. The carbon tax policy is helpful to build an environment-friendly and resource-conserving society.
Highlights
WITH continuous industrial and economic growth, worldwide energy consumption is inexorably rising, with concomitant increases in greenhouse gas emissions
The results indicated that remanufacturing can effectively improve the level of carbon emission reduction, and it was profitable to the manufacturer and the retailer
Zhou et al [47] considered the optimal carbon tax design for manufactures’ carbon emissions, while we examine the influence of different power structures, the relationship between the two retailers
Summary
WITH continuous industrial and economic growth, worldwide energy consumption is inexorably rising, with concomitant increases in greenhouse gas emissions. On June 4, 1992, in Rio de Janeiro, Brazil, the UNFCCC (United Nations Framework Convention on Climate Change) was adopted at the UNCED (United Nations Conference on Environment and Development). (iii) How does the CT rate influence SC pricing decisions and profits under different vertical and horizontal relationships?. We examine the influence of some factors including different power structures, the relationship between the two retailers, and more especially, the CT rate on both SC pricing decision and on profits.
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
