Altruistic profit allocation rules for joint replenishment with carbon cap-and-trade policy

Hu, Feng; Zeng, Yinlian; Cai, Xiaoqiang; Qian, Qian; Zhou, Yong‐Wu

doi:10.1016/j.ejor.2020.08.040

Cited by 36 publications

(16 citation statements)

References 50 publications

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“…The first stream of research focuses on investigating the cap-and-trade mechanism in supply chain management. Some scholars consider the problems of the emission reduction investment strategy [18][19][20] and inventory decisions [21][22][23][24]. In addition, some scholars analyze how the cap-and-trade mechanism affects production and management decisions from a different perspective, which is the main field of our research.…”

Section: The Cap-and-trade Mechanismmentioning

confidence: 99%

Pricing and Quantity Decisions under Asymmetric Carbon Emission Reduction Information and Cap-and-Trade Mechanism

Xie

Deng

Chen

2023

IJERPH

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With the continuous spread of cap-and-trade mechanisms and consumers’ great concerns about environmental issues, manufacturers strive to reduce carbon emissions. Unfortunately, they are not always willing to disclose their accurate emission reductions or may even falsify emission reduction information. By developing a signaling model, we explore the impact of the cap-and-trade mechanism and asymmetric information on the decision-making of supply chain members composed of a manufacturer regulated by the cap-and-trade mechanism, and a retailer. As a result, we show that the low-type manufacturer has the incentive to mimic the pricing behavior of the high-type manufacturer under information asymmetry. Thus, in order to avoid this mimicry, the high-type manufacturer will distort the wholesale price. Moreover, the impact of the cap-and-trade mechanism on the manufacturer depends on the initial quotas. Only when the initial quota is in the middle range does the high-type manufacturer benefit, while the low-type manufacturer suffers. Furthermore, the low-type manufacturer tends to hide emission reduction information, while the high-type manufacturer tends to disclose the information. We also address how information asymmetry weakens the emission reduction advantages of the high-type manufacturer. However, the cap-and-trade mechanism can effectively alleviate this negative effect.

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Section: The Cap-and-trade Mechanismmentioning

confidence: 99%

Pricing and Quantity Decisions under Asymmetric Carbon Emission Reduction Information and Cap-and-Trade Mechanism

Xie

Deng

Chen

2023

IJERPH

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“…The carbon cap-and-trade system, as an effective emission reduction approach, has been extensively analyzed by scholars in its impact on emission reduction through factors such as carbon trading prices [7][8][9][10][11] and carbon allowances [9]. As research progresses, scholars have integrated the carbon cap-and-trade mechanism with supply chain issues such as inventory management [12,13], supply chain financing [14,15], remanufacturing [8,16,17], channel structure [17][18][19], and competition [20]. Additionally, studies have compared the impact of carbon tax and carbon trading policies on the supply chain, such as refs.…”

Section: Literature Reviewmentioning

confidence: 99%

Ordering Decisions with an Unreliable Supplier under the Carbon Cap-and-Trade System

Ren,

Bian,

et al. 2023

Sustainability

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The global focus on carbon reduction has intensified, prompting numerous high-energy-consuming enterprises to venture into the carbon cap-and-trade system. However, in recent years, the emergence of destabilizing factors has introduced disruptions to supply chains. The study addresses the two-stage ordering problem for a manufacturer under the carbon cap-and-trade system. In the first stage, the manufacturer engages in green investments and places orders with both an unreliable and a reliable supplier. After updating demand forecast information in the second stage, orders are placed with the backup supplier, and carbon allowances are settled at the end of the period. Under these conditions, three supply scenarios of the unreliable supplier are considered: time-varying supply with imperfect demand updates, all-or-nothing supply with imperfect demand updates, and time-varying supply with perfect demand updates. Optimal ordering decisions are provided for each scenario. We find that when demand updates are imperfect, the manufacturer will invariably engage with the unreliable supplier. However, when demand updates are perfect, the manufacturer may choose to forgo the unreliable supplier. Next, we analyze the influence of carbon trading prices on ordering decisions in these scenarios. We find that when the probability of disruption is substantial, dual sourcing must exist in the first stage under the all-or-nothing supply. Finally, we conduct numerical analysis by utilizing parameters, such as carbon trading prices, as referenced in the existing literature. Through numerical analysis, we find that opting for the all-or-nothing supplier becomes economically advantageous for the manufacturer when the backup supplier is profitable. Conversely, when the backup supplier is not profitable, the manufacturer tends to opt for the unreliable supplier with time-varying supply. Moreover, optimal profit for the manufacturer is not achieved when demand updates are perfect.

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“…They find that social welfare under a revenue-sharing contract is higher (lower) than that under a wholesaleprice contract if the consumer's environment awareness is high (low). Feng et al (2020) focus on the issue of the joint replenishment among retailers under a GM, and find that the retailer with the most altruistic behaviour obtained surplus carbon allowances from other retailers. Cheng et al (2022) discuss the lower carbon emissions technology for a closed-loop supply chain between GM and tax mechanisms, and they find that these carbon mechanisms could improve the lower carbon emissions technology investment.…”

Section: Cap-and-trade Mechanismsmentioning

confidence: 99%

Competition vs cooperation: renewable energy investment under cap-and-trade mechanisms

Chen

2022

Financ Innov

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This paper explores the incentives of investment in renewable energy of two utility firms who compete or cooperate under either a cap-and-trade grandfathering mechanism (GM) or benchmarking mechanism (BM). We find that utility firms will invest in renewable energy more under BM than under GM, in both competitive and cooperative markets, and they will invest more in a competitive market than in a cooperative market, under either GM or BM. Furthermore, utility firms will produce more electricity and generate more total carbon emissions under BM than under GM. The profits of two firms, however, are higher in cooperative market than in competitive market. The government will benefit from implementing a BM to encourage utility firms to invest in renewable energy in a competing market.

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Altruistic profit allocation rules for joint replenishment with carbon cap-and-trade policy

Cited by 36 publications

References 50 publications

Pricing and Quantity Decisions under Asymmetric Carbon Emission Reduction Information and Cap-and-Trade Mechanism

Pricing and Quantity Decisions under Asymmetric Carbon Emission Reduction Information and Cap-and-Trade Mechanism

Ordering Decisions with an Unreliable Supplier under the Carbon Cap-and-Trade System

Competition vs cooperation: renewable energy investment under cap-and-trade mechanisms

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