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Abstract:We study an emission-dependent dyadic fashion supply chain made up of a supplier and a manufacturer, both of which can reduce their own component/product emissions to serve the carbon-footprint sensitive consumers. With Carbon Tax regulation, we consider four scenarios resulting from two ways in form of adopting transfer price contract and/or introducing third-party emission-reduction service (TPERS) to enhance the efficiency of systematic emission reductions. We refine four models from these corresponding scenarios, which in turn constitute a decision-making framework composed of determining vertical incentives and choosing supply chain structures. By exploiting Stackelberg games in all models, we compare their emission reduction efficiencies and profitability for each pair of settings. Theoretic analysis and numerical studies show that adopting vertical transfer payment schemes can definitely benefit channel carbon footprint reduction and Pareto improvement of supply chain profitability, regardless of whether the emissionreduction service exists or not. However, whether introducing TPERS or not is heavily depending on systematic parameters when the transfer payment incentive is adopted there. We also provide insights on the sensitivity of carbon tax parameters with respect to the supply chain performance, overall carbon emission reduction, vertical incentive and TPERS adopting decision-makings. OPEN ACCESSSustainability 2015, 7 4281

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The paper studies how the combination of the manufacturer’s carbon emission reduction and the retailer’s emission reduction relevant promotion impacts the performances of a dyadic supply chain in low-carbon environment. We consider three typical scenarios, that is, centralized and decentralized without or with side-payment. We compare measures of supply chain performances, such as profitabilities, emission reduction efficiencies, and effectiveness, in these scenarios. To improve chain-wide performances, a new side-payment contract is designed to coordinate the supply chain and numerical experiments are also conducted. We find the following. (1) In decentralized setting, the retailer will provide emission cutting allowance to the manufacturer only if their unit product profit margin is higher enough than the manufacturer’s, and the emission reduction level of per unit product is a monotonically increasing function with respect to the cost pooling proportion provided by the retailer; (2) the new side-payment contract can coordinate the dyadic supply chain successfully due to its integrating sales promotion effort and emission reduction input, which results in system pareto optimality under decentralized individual rationality but achieves a collective rationality effect in the centralized setting; (3) when without external force’s regulation, consumers’ low-carbon awareness is to enhance consumers’ utility and decrease profits of supply chain firms.

Reducing carbon emissions, including emission abatement outsourcing at the supply-chain level, is becoming a significant but challenging problem in practice. Confronting this challenge, we therefore break down the practice to focus on a low-carbon supply chain consisting of one supplier, one manufacturer and one third-party emission-reducing contractor. The contractor offers a carbon reduction service to the manufacturer. In view of the increasing proportion of Greenhouse Gases (GHG) emissions and absence of carbon reduction policies in developing countries, we adopt the prospect of consumers’ low-carbon preferences to capture the demand sensitivity on carbon emission. By exploiting the Mean-Variance (MV) model, we develop a supply chain game model considering risk aversion. Comparing the supply chain performances of the cases under risk neutrality and risk aversion, we investigate the impact of the risk aversion of the supplier and the manufacturer on the low-carbon supply chain performances, respectively. We show that the risk aversion of chain members will not influence the relationship underlain by the profit-sharing contract between the manufacturer and contractor, whereas they may extend the supplier’s concerning range. Although the manufacturer’s risk aversion has a positive impact on the wholesale price, interestingly, the supplier’s impact on the wholesale price is negative. Furthermore, we propose a contract to coordinate the risk-averse low-carbon supply chain by tuning the aversion levels of the supplier and the manufacturer, respectively. Through numerical study, we draw on managerial insights for industrial practitioners to adopt a low carbon strategy potentially by managing the risk attitudes along the supply chain channel.

Aiming at exploring the interplay principles of operations strategies among members of dvertising and emission reduction cost sharing contracts and coordination in low-carbon sulow-carbon supply chain, as well as their impact on system performance, we develop an evolutionary game model to capture emission reduction and low-carbon promotion actions, which are typically conducted by one manufacturer and one retailer in every two-echelon supply chain, respectively. We exploit the evolutionary game model to analyze players’ behavioral patterns of their interacting strategies, whereby we attain the evolutionary stable strategies and their associated existing preconditions under various scenarios. We acquire a number of managerial insights, and particularly find that the evolutionary stable strategies of the channel carbon reduction and promotion are remarkably influenced by incremental profits resulted from causes, such as every player’s unilateral participation in emission reduction. In addition, we investigate a player’s free-rider opportunistic practice in cooperative carbon reduction and joint participation in emission reduction. However, the magnitude of profit increment will heavily influence the result of Evolutionary Stable Strategy (ESS). Finally, the extensive computational studies enable us to verify the effectiveness of preceding models.

We focus on the joint production planning of complex supply chains facing stochastic demands and being constrained by carbon emission reduction policies. We pick two typical carbon emission reduction policies to research how emission regulation influences the profit and carbon footprint of a typical supply chain. We use the input-output model to capture the interrelated demand link between an arbitrary pair of two nodes in scenarios without or with carbon emission constraints. We design optimization algorithm to obtain joint optimal production quantities combination for maximizing overall profit under regulatory policies, respectively. Furthermore, numerical studies by featuring exponentially distributed demand compare systemwide performances in various scenarios. We build the “carbon emission elasticity of profit (CEEP)” index as a metric to evaluate the impact of regulatory policies on both chainwide emissions and profit. Our results manifest that by facilitating the mandatory emission cap in proper installation within the network one can balance well effective emission reduction and associated acceptable profit loss. The outcome that CEEP index when implementing Carbon emission tax is elastic implies that the scale of profit loss is greater than that of emission reduction, which shows that this policy is less effective than mandatory cap from industry standpoint at least.

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