Low-carbon Preference Research Articles

Fresh agricultural products supply chain coordination considering consumers' dual preferences under carbon cap-and-trade mechanism

<p style='text-indent:20px;'>In order to achieve the goal of "carbon neutral" development, under the conditions of carbon quota trading policy, consumers' preference for fresh agricultural products and low-carbon preference, this paper discusses the equilibrium decision-making problem of a two-level fresh agricultural products supply chain. And the cost sharing contract and the two-part pricing contract are introduced to coordinate the supply chain. The results show that: the fresh-keeping and low-carbon efforts made by fresh produce suppliers are related to consumers' preferences, fresh-keeping costs, low-carbon costs, fresh-keeping carbon emission factors, and carbon reduction efficiency; under certain conditions, both the cost sharing contract and the two-part pricing contract can coordinate the supply chain of fresh agricultural products; given certain costs and carbon reduction efficiency, which contract retailers choose depends on consumers' consumption preferences and the size of the supplier's initial carbon emissions; when both contracts are valid, it is more advantageous for the retailer to choose two-part pricing contract; the higher the carbon trading price, the better the incentive effect on suppliers' fresh-keeping efforts and low-carbon efforts.</p>

Optimal dual-channel design for manufacturers under different consumer low-carbon preferences for products

Optimal dual-channel design for manufacturers under different consumer low-carbon preferences for products

An evolutionary game analysis of new energy vehicles promotion considering carbon tax in post-subsidy era

This paper uses evolutionary game theory to explore an effective carbon taxation mechanism in post-subsidy era based on hoteling demand. First, an evolutionary game model is constructed to explore interplays between local governments and auto-manufacturers. Then, optimal carbon tax mechanism and parameters sensitivity are analyzed and compared in different scenarios using empirical analysis. We conclude that: (1)In subsidy phase-out scenario, static carbon tax policy is better than phasing in carbon tax policy; in subsidy withdrawn scenario, phasing in carbon tax policy can popularize NEVs in a more stable way. (2)Under the mechanism of withdrawal subsidy and carbon tax phase-in, there exist marginal diminishing effects in phase-in rate r and carbon tax rate Tc; under the mechanism of subsidy phase-out and static carbon tax, both marginal increasing effect and marginal decreasing effect are existed in carbon tax rate Tc. (3)Under the mechanism of withdrawal subsidy and carbon tax phase-in, a threshold effect is found in carbon emission trading revenue Rc, license priority for NEVs consumers η, charging pile coverage rate β, corporate income tax concession Rd, consumers' low carbon preference θ and vehicle purchase tax Tb, while there is a marginal incremental effect in them under the mechanism of withdrawal subsidy and carbon tax phase-in, and the parameters in former mechanism are more sensitive. Further, those parameters are divided into three levels according to their influential degree, in which consumers’ low carbon preference θ is at first level. Accordingly, it is suggested that governments implement appropriate carbon tax policies at different industrial developmental phase, supplemented by support policies paying most attention on vigorously promoting low-carbon consumption or subsidizing low-carbon behaviors.

Decisions on Technologies for Emissions Control in Port Areas under Subsidy and Low-Carbon Preferences of Customers

The emission control technologies decisions of port and shipping enterprises under subsidy and customers’ low-carbon preferences are discussed from a supply chain perspective. The game models are established under three game models (port-leader Stackelberg game, ship-leader Stackelberg game, and Nash game). The obtained results show that the impact of subsidy and low-carbon preference on demand in its pricing always is considered by the leader in the port supply chain. The profits and emissions in the Nash game are higher than that in the Stackelberg game. When subsidies and customers’ low-carbon preferences are low, the supply chain’s overall profits of using low sulfur oil are higher than that of using shore power. But the supply chain’s carbon emissions of adopting low sulfur oil are also higher than that of adopting shore power. When subsidies and low-carbon preferences of customers are high, the supply chain’s overall profits of using shore power are higher than that of using low sulfur oil. But the supply chain’s carbon emissions of adopting shore power are also higher than that of adopting low sulfur oil. When subsidy and low-carbon preference of customers are in the appropriate(medial) range, the supply chain would choose shore power to reduce emissions from the perspective of profits, and the whole carbon emissions of using shore power are lower than that of using low sulfur oil, so the regulator(government) and enterprises can achieve a win-win situation. Hence for a regulator who has to balance emission control and enterprises’ profits, implementing moderate subsidy within the appropriate range is the better strategy.

Grandfathering or benchmarking: Which is more viable for the manufacturer’s low-carbon activities?

Under the emissions trading policy, two typical carbon allowance allocation rules of grandfathering and benchmarking are widely adopted in the present carbon markets. Based on the mathematical modeling method, this paper explores which allocation rule is more viable for manufacturers’ low-carbon activities including abatement investment and remanufacturing activities. Meanwhile, the effects on total profit, total carbon emissions, consumer surplus, and social welfare are discussed through numerical analysis. The results show that benchmarking is more viable for abatement investment activities of manufacturers than grandfathering. Additionally, benchmarking is always more viable for remanufacturing activities of manufacturers only in a situation with a higher consumer low-carbon preference. Otherwise, which allocation rule is more beneficial for remanufacturing activities mainly depends on the abatement cost coefficient. Correspondingly, the higher the consumer low-carbon preference or the lower the abatement cost, the more viable the benchmarking is to achieve each performance target (e.g., total profit, emissions control, consumer surplus, and social welfare). Based on these findings, this paper also recommends managerial insights for manufacturers and policy implications for policy-makers.

Choice of Emission Control Technology in Port Areas with Customers’ Low-Carbon Preference

The choice of emission control technology in a port supply chain under a cap-and-trade scheme considering low-carbon preferences of customers, is explored in this study. In port areas, the port supply chain consisting of one port and one ship can adopt either shore power (SP) or low sulfur fuel oil (LSFO) to reduce emissions. The economic and social performance of the port supply chain when either SP or LSFO is implemented is compared under three different game models (port-leader Stackelberg game, ship-leader Stackelberg game and the Nash game). The obtained results show that the profits and emissions in the Nash game are higher than those in the other two games. When environmental concern is relatively small, social welfare in the Nash game is the highest, while social welfare in the one-party-dominant structure is superior to that in the Nash structure, under high environmental concern. When the customers’ low-carbon preferences and carbon prices are low, both the supply chain’s profits and carbon emissions when LSFO is used are higher than those from using SP. From the perspective of social welfare maximization, in general, LSFO is preferred when carbon price, customers’ low-carbon preference and environmental concern are all low or are all high. Otherwise, SP is the optimal decision. The findings can provide insights for governments in formulating emission control policies according to their own interests.

Coordination of Automobile Supply Chain Considering Relative Endurance Level under the Dual-Credit Policy

The implementation of the dual-credit policy has had a significant impact on the development of new energy vehicles. Considering the background of the dual-credit policy, this paper examines the concept that demand is influenced by price, consumer low-carbon preference, and concerns regarding endurance. First, we study the pricing decisions of a two-level automobile supply chain consisting of two manufacturers and one dealer and discuss the influence of the dual-credit policy on decision making. Two methods are then used to coordinate the supply chain, and the results are verified by numerical analysis. The results show that: (1) the stronger the concerns of consumers regarding a low-carbon preference and endurance, the better the development of new energy vehicles; (2) raising the integral calculation coefficient and the integral price can increase the demand for, and profits from, new energy vehicles, which can expand the market; and (3) the supply chain can be fully coordinated through Nash negotiations. This paper theoretically demonstrates the impact of factors such as car endurance on corporate decision making, guiding car companies to make pricing decisions based on market conditions.

The role of the procurement commitment contract in a low-carbon supply chain with a capital-constrained supplier

We study a supply chain consisting of a retailer and a capital-constrained supplier that produces a single product with low-carbon attributes. To cater for the carbon trading market, i.e., in the cap-and-trade regulation setting, and consumers' low-carbon preference, the supplier may invest in carbon emissions reduction. Capital-constrained, the supplier raises funds from a competitive banking market to carry out its production, carbon abatement investment, and even insufficient emissions permits purchase. We study the impacts of the procurement commitment (PC) contract provided by the retailer on the economic and environmental performance of the supply chain. We first develop a Stackelberg game between the retailer and supplier, where the former as the leader decides the PC amount, and the latter as the follower chooses the output and carbon abatement level. We derive the equilibrium outcomes of the game under the scenarios without and with emissions-dependent demand. We find that the retailer will provide the PC contract only when the supplier's gross margin is less than a certain threshold, under which Pareto-improvement of the supply chain can be achieved. However, providing the PC contract will hamper the carbon abatement performance of the supply chain, in terms of the total carbon abatement or abatement per unit product. We further extend the pure PC contract to the cases with credit limit or carbon abatement target, respectively. We find that if the bank sets a credit limit for the supplier based on the value of the retailer's PC contract, the retailer will always provide the contract to enhance the supplier's financing and production capacity, regardless of the supplier's gross margin, and such a contract exhibits a similar economic and environmental role as that in the case with no credit limit. However, if the retailer imposes a specified carbon abatement target on the supplier as a precondition of providing the PC contract, the contract may achieve coordinated improvement of the economic and environmental benefits of the supply chain. We also extend the problem to an “investment-then-contract” case, in which the supplier chooses the carbon abatement level before both parties make the quantity-related decisions, and we find that the retailer's PC contract will not change the supplier's carbon abatement decisions in both cases without and with consumers' green preference, and it only functions to stimulate the supplier's output under certain circumstances.

Advance selling of uncertain demand in low-carbon supply chain

PurposeThe development of low-carbon production is impeded by the investment costs of green technology research and development (R&D) and carbon emission reduction while facing the uncertain risk of emission reduction investment. With the government's carbon emission constraints, green manufacturers implement the advance selling strategy to increase both profit and reduction level. However, few studies consider the consumer's green preference and emission constraints in advance selling market and spot market independently. The authors' paper investigates the optimal strategies of advance selling pricing and reduction effort for green manufacturers to maximize profits.Design/methodology/approachThe authors' paper designs a stochastic model and investigates the manufacturer's optimal strategies of advance selling price and emission reduction efforts by categorizing different purchasing periods of low-carbon consumers. With the challenges of uncertain demand and government's emission constraints, the authors' develop the non-linear optimization model to investigate the manufacturer's profit-oriented decisions.FindingsThe results show the government's carbon constraints cannot influence the manufacturer's profit, but the consumer's low-carbon preference in the advance selling period can. Interestingly, the manufacturer will make fewer reduction efforts even when the consumers have stronger environmental awareness. In addition, the increasing consumer price sensitivity will exacerbate the profit loss from mandatory emissions reduction. Overall, for achieving a win–win situation between emission reduction and profit growth, green manufacturers should not only consider the sales strategies, market demand, and government constraints in a low-carbon market, but also pay attention to the uncertainty of green technology innovation.Originality/valueWith the consideration of the government's carbon emission constraints, uncertain demand, and low-carbon consumer's preferences, the authors' study innovatively incorporates the joint impacts of advance selling strategy and emission reduction effort strategy and then differentiates between two cases that pertain to the diverse carbon emission regulations.

Information Sharing in Competing Supply Chains with Carbon Emissions Reduction Incentives

This paper investigates the incentives of firms to share demand information in two competing supply chains. We consider a model in which each supply chain consists of a manufacturer and a retailer, and the manufacturers decide their products’ carbon emissions reduction levels. Through information sharing, manufacturers can adjust their wholesale price and the level of carbon emissions reduction according to the demand signal. The results reveal that information sharing always benefits the manufacturer. Information-sharing arrangements are more likely to occur when the manufacturer’s carbon emissions reduction efficiency or the customer’s low-carbon product preference is relatively high. Moreover, under Cournot competition, the retailer’s incentive to share information increases when information is less accurate or the competition is less intense. By sharing demand information, manufacturers will invest more in reducing the carbon emissions of their products. Therefore, there are two effects of information sharing: the “economic effect” on the benefits of all parties and the “environmental effect” on reducing carbon emissions. Our findings highlight the economic and environmental incentives of information sharing in the supply chain and the synthesis impacts of low-carbon preferences, efficiency of carbon emissions reduction, and the competition intensity on the retailer’s incentives to share information.

Optimal decisions in two-echelon supply chain under hybrid carbon regulations: The perspective of inner carbon trading

With the widespread use of carbon tax and cap-and-trade regulation, the coexistence of hybrid carbon regulations is becoming the trend. Under hybrid carbon regulations, considering consumers’ low-carbon preferences and carbon trading within the supply chain, a two-echelon supply chain consisting of one leading manufacturer and one supplier is proposed. Based on different carbon permit constraints, we derive optimal decisions in four different carbon trading cases. Then, we conduct the comparison and sensitivity analysis. The result indicates that (1) Inner carbon trading may not affect manufacturer’s production and carbon emission reduction (CER) decisions, but it always affects the supplier’s wholesale price. (2) Inner carbon trading can benefit the environment only when the manufacturer’s surplus permits are insufficient. In other inner carbon trading cases, the impact on the environment is equal to that in the outer carbon trading case. (3) The increase in consumers’ low-carbon preference can promote the manufacturer’s CER and members’ profits, but it also leads to an increase in total carbon emissions. To control total carbon emissions, the government can increase the carbon tax or outer carbon trading price. (4) For given carbon permits, changes in important parameters may lead to the transformation of inner carbon trading cases, which causes huge fluctuations in members’ profits. Finally, we provide valuable managerial insights for the government and supply chain members.

Cost-sharing contract design between manufacturer and dealership considering the customer low-carbon preferences

Manufacturers and dealerships usually have a long-term cooperation in selling low-carbon products produced by signing a contract without considering the dynamic changes in consumer’s low-carbon preferences. Consumers’ low-carbon awareness and the low-carbon reputation of those low-carbon products occasionally alternate affected by the market circumstances, which will influence the selling of low-carbon products. This paper focuses on the contract design between a manufacturer and a dealership using Stackelberg differential game models to formulate the long-term contract between a manufacturer and a dealership. To promote the low-carbon reputation of low-carbon products, two cost-sharing contracts, including a one-way cost-sharing contract (OWC) and a two-way cost-sharing contract (TWC), are proposed. The manufacturer in the OWC contract provides a certain amount of subsidies to incentivize the dealership. The manufacturer and the dealership share costs in the TWC contract. Besides, dual-channel models are also analyzed as an extension of the proposed model. Several findings were obtained by solving and analyzing the proposed game models. The manufacturer’s emission reduction efforts and the dealership’s low-carbon promotion efforts are influenced by dealership’s cost coefficient related to the promotion of low-carbon product, low carbon reputation sensitivity coefficient of consumers, influence coefficient of manufacturer’s emission reduction efforts on low-carbon reputation and etc. The proposed cost-sharing contracts improve the manufacturer and the dealership’s efforts by changing the factors. The OWC contract can achieve Pareto improvement, and the TWC contract can realize the coordination between the manufacturer and the dealership. The optimal conditions for its contract choice are also proposed from the manufacturer’s point of view. This paper also provides valuable insights for companies in the supply chain to design suitable contracts to coordinate the supply chain stakeholders’ activities, especially in promoting low-carbon efforts in a long-term cooperation.

Does the carbon trading mechanism affect social and environmental benefits of the retailer-led supply chain: Strategic decisions of emissions reduction and promotion

Governments, enterprises, and customers have become more concerned about environmental protection. Following the world’s largest carbon trading market (EU ETS), China has also implemented a market-based carbon trading mechanism (CAT) to reduce CO2. Simultaneously, customers have low-carbon preferences for environmental products. Thus, the enterprises’ strategic decisions and collaboration modes have changed. This article develops the Stackelberg game model to explore the impacts of CAT and customers’ low-carbon preference on the carbon emission reduction and promotion strategies in a retailer-led supply chain (such as RT-Mart, Walmart, Amazon, etc.). In this model, the retailer decides whether to promote environmentally safe products and the manufacturer decides whether to reduce CO2. We find that carbon trading market price and customers’ low-carbon preference are key factors influencing the retail price, total carbon emissions, and social welfare. Interestingly, there is not always a positive correlation between customers’ low-carbon preference and social welfare. To achieve Pareto improvement of social welfare, manufacturers and retailers require co-optimization. Theoretically, our research enriches the research streams of the CAT policy and socially responsible operations of the supply chain. Moreover, managerial insights are provided for retailer-led supply chain stakeholders and emission reduction regulators, which contribute to enhancing the social and environmental benefits of the supply chains.

Low-carbon transition pathways in the context of carbon-neutral: A quadrilateral evolutionary game analysis

In the context of carbon-neutral, countries are urging a social-wide transition to decarbonization. However, the efficiency of this transition has not been as expected due to the game of benefits among relevant players. Here, we develop a quadrilateral evolutionary game model that highlights the complex interactions at a multi-player level, including producers, regulators, third-party certifiers, and consumers, in order to analyze evolutionary pathways and stable strategies. Our results suggest that: (1) there are significant correlations among the quadrilateral game players, and the benign interactions among them will effectively drive the social-wide low-carbon transition; (2) if consumers have higher low-carbon preferences, producers will be attracted to actively choose the low-carbon transition strategy, which may form a stable portfolio strategy; (3) proper interventions, such as reducing transition costs, increasing reputation loss, and raising consumers’ whistle-blowing abilities, can help promote the systematic evolution to the low-carbon state; and (4) rent-seeking behavior between producers and third-party certifiers should be strongly monitored by regulators, and higher penalties can prevent their duty dereliction. These findings provide significant implications for policy-makers to make better-informed decisions about the social-wide low-carbon transition in the context of carbon-neutral.

Manufacturer's Encroachment and Carbon Emission Reduction Decisions Considering Cap-and-Trade Regulation and Consumers' Low-Carbon Preference.

Carbon emission reduction and achieving carbon neutrality has become an inevitable trend in the sustainable development era. We investigate the manufacturer’s encroachment and carbon emission reduction decisions considering government cap-and-trade regulations and consumers’ low-carbon preference. The equilibrium decisions for the four scenarios are analytically obtained and compared based using the Stackelberg game. A comparison with and without cap-and-trade regulation under two encroachment decisions regarding member’s profits and carbon emission reduction levels are conducted. It is shown that the encroachment decision is always advantageous for the manufacturer if the government decides not to implement cap-and-trade regulation, and the retailer always loses profit. Moreover, if the carbon quota is sufficient, cap-and-trade regulation benefits the manufacturer. Otherwise, the manufacturer’s encroachment decision depends on the appropriate initial unit amount of carbon emission and unit carbon price. The retailer’s profit may not always be hurt by the manufacturer’s encroachment with cap-and-trade regulation; unless the unit carbon price exceeds a certain threshold, a higher consumer’s low-carbon preference in the encroachment scenario reduces more carbon emissions than in the no-encroachment scenario for the manufacturer. Further, the rising platform commission rate causes the platform profit to increase first and then decrease; the platform profit will slightly decrease if both products become more substitutes.

Coping Decisions of Production Enterprises under Low-Carbon Economy

It aims to study the production and emission reduction decisions of production enterprises under carbon constraints. In the case of carbon constraints in production, manufacturers have four strategic choices: production within the carbon quota, adopting emission reduction technologies, purchasing carbon emission rights, and using emission reduction technologies and purchasing carbon emission rights. Based on the income model of production enterprises under four different strategies, first, under the condition of maximizing the interests of production enterprises, the optimal profit, optimal production, optimal total carbon emission, and optimal emission reduction rate under different carbon constraints are determined, and summarize its laws. Afterward, in order to further optimize corporate profits, the impact of changes in the carbon reduction scale cost and consumers’ low-carbon preference was studied. Several important conclusions are shown as follows. First, the stricter the carbon constraint policy, the greater the optimal emission reduction rate of enterprises. Second, the adoption of emission reduction technology can effectively reduce the impact of carbon constraint on output. Third, the optimal strategy is to both reduce emissions and purchase carbon emission rights, which can realize environmental economic dividends. Fourth, the lower the cost factor of the carbon reduction scale and the higher the low-carbon preference of consumers, the easier it is for firms to achieve carbon sufficiency in their production.

The Pricing Mechanism Analysis of China’s Natural Gas Supply Chain under the “Dual Carbon” Target Based on the Perspective of Game Theory

China is currently the world’s largest energy consumer and carbon emitter. In order to reduce the harm of carbon dioxide to the global ecological environment, the use of natural gas instead of coal is a realistic choice for China to achieve the “dual carbon” goal. Opportunities also bring new challenges, and the price of natural gas is an important method of promoting the upstream and downstream industrial chains of natural gas, so it is of great practical significance to study the price of natural gas. This paper builds a three-level supply chain model consisting of suppliers in the natural gas market, city gas companies and consumers in the market and uses the Stackelberg game to study the decision-making models of different subjects under their own dominance and centralized decision-making; it also considers the pricing mechanism and profit situation of stakeholders in the natural gas market under the low-carbon preference of consumers and the level of corporate carbon emission reduction. The research results show that when considering consumers’ low-carbon preferences, the sales prices of various stakeholders in the market have increased, which is beneficial for all entities in the natural gas industry chain. At the same time, with the low-carbon transformation of energy companies, the production method drives the price of raw materials to rise in the process of low-carbon innovation, which, in turn, makes the price of various stakeholders in the natural gas market and the level of carbon emission reduction per unit show a positive relationship; in order to maximize the overall profit of the supply chain, the natural gas market should adopt a centralized decision-making method to further promote the reform of China’s natural gas marketization.

Dynamic production and carbon emission reduction adjustment strategies of the brand-new and the remanufactured product under hybrid carbon regulations

In recent years, the government and consumers are concerned about environmental issues. Motivated by carbon regulations and consumers’ low-carbon preferences, manufacturers have implemented carbon emission reduction (CER) through green technologies and remanufacturing. Most of the existing literature related to the low-carbon supply chain considered single carbon regulation and assumed that enterprises are completely rational. However, in practice, it is rather difficult for the government to achieve the carbon reduction target only by a single carbon regulation, and manufacturers are bounded rational due to the complexity of the low-carbon market. Consequently, based on bounded rationality, this paper aims to investigate the dynamic production and CER adjustment strategies of the brand-new and the remanufactured product under hybrid carbon regulations, i.e. the carbon tax regulation and the cap-and-trade regulation. Furthermore, the impacts of adjustment parameters and important parameters on decision variables, expected profits, and total carbon emissions are explored. The results showed that adjustment speeds of production and CER have significant impacts on the system stability. For both manufacturers, excessive production and CER adjustment strategies not only reduce their own expected profits but also cause more harm to the environment. In addition, the increase of the carbon tax, the carbon trading price, and consumers’ low-carbon preferences all shrink the stable regions of adjustment parameters, but the increase of these parameters can promote CER behaviors and reduce total carbon emissions. Finally, the feedback control method was used to control the chaos of the supply chain system.

Optimal pricing and complex analysis for low-carbon apparel supply chains

Motivated by the low-carbon economic development, we study the competition issues in apparel supply chains considering consumers’ low-carbon preferences. In this paper, we construct static and dynamic decision-making models under different game scenarios based on the centralized and decentralized frameworks. Firstly, we explore the critical conversion conditions between the centralized and decentralized frameworks with the static game models. The centralized model benefits the whole supply chain when the low-carbon investment coefficient is moderate. On the contrary, the decentralized model benefits the supply chain when the low-carbon investment coefficient is smaller or larger. Secondly, combined with the local and global bifurcation theory, we examine the complex effect of adjustment parameters on the dynamic system. The dynamic game systems show bifurcation, chaos, and multi-stability as the adjustment parameters change continuously. Therefore, we apply a hybrid chaos control method to stabilize the dynamic system. Thirdly, we compare the average profits in the dynamic game scenarios and show the complex relationships with the varying parameters. Finally, some management insights and suggestions are presented based on our findings.

Retailer-driven carbon emission reduction: contract design in the presence of information asymmetry and cap-and-trade.

This study considers a supply chain consisting of a dominant brand-name retailer and a manufacturer in the presence of a cap-and-trade mechanism and consumers’ low-carbon preference. The retailer exerts advertising efforts, while lacks of the manufacturer’s private carbon emission reduction effort cost information. We construct the benchmark model with information symmetry and asymmetry respectively. We obtain all members’ equilibrium solutions and analytically examine the impact of the manufacturer’s carbon emission reduction effort cost, the retailer’s advertising effort cost, and consumers’ low-carbon preference on the supply chain members’ decisions. And then, we systematically compare two scenarios to obtain the condition in which the manufacturer would be willing to share the private information. With the aim of improving the manufacturer’s carbon emission reduction effort level and all members’ economic performance, we further propose a two-part tariff contract for information symmetry and asymmetry, respectively.