Research on pricing strategies for competitive green supply chain based on corporate social responsibility

Abstract

With the increasing public awareness of environmental protection, corporate social responsibility has become an important component of sustainable development and competitive advantage for many enterprises. Although there are many studies on corporate social responsibility in the supply chain, there is still a lack of research on the impact of corporate social responsibility on various decision-makers in the competitive green supply chain dominated by upstream enterprises. Therefore, taking into account the greenness and corporate social responsibility, the paper proposes three Stackelberg game models with the two-echelon supply chain consisting of two competing manufacturers and one socially responsible retailer. We develop a series of propositions and corollaries to determine the optimal solutions and offer some managerial insights. The main novelties and contributions of the paper can be demonstrated in two aspects. First, the paper simultaneously considers the impact of competition intensity and CSR level on wholesale prices, retail prices and greenness level. Second, the paper discusses the impact of two manufacturers with different market positions investing in green products on the profits and utility of supply chain members. Numerical illustrations prove that the level of corporate social responsibility is negatively correlated with retailer profitability and the retailer achieve the highest profits when sub-dominant manufacturer produces green products.