This paper develops a differential game model to study the effects of regulatory pressure and consumer environmental awareness on the channel members' profits and manufacturer's emissions in a supply chain. The government imposes pollution a tax and consumer green preference is considered. Results show that (i) in the decentralized scenario, the channel efficiency in higher regulatory pressure case is lower than that in the lower regulatory pressure scenario; (ii) whether the retailer responsibility is exogenous or negotiated, higher regulatory pressure or consumer environmental awareness can serve as an effective pollution‐curbing measure; (iii) the retailer responsibility can perfectly coordinate the supply chain.

With the robust control framework of Hansen and Sargent (2001), this paper investigates a stochastic differential game of transboundary pollution between two regions under Knightian uncertainty of stock dynamics. Both regions are assumed to play a noncooperative and a cooperative game, and the worst-case pollution accumulation processes for discrete robustness parameters are characterized. Our objective is to identify both regions’ optimal output and emission levels and analyze the effects of the Knightian uncertainty of pollution stock dynamics on both regions’ optimization behavior. We illustrate the results with some numerical examples.

This paper proposes a further extended producer responsibility system to study the operations of the supply chain with fairness concerns. By comparing four scenarios regarding whether channel members concern fairness, we obtain the following results: the coordinated development can be accomplished for channel members when the dominant producer makes pricing decisions with more consideration for the profit of follower; both the producer and the retailer can adjust the degree of demand information disclosure in some ways to obtain more profits; the further extended producer responsibility system (FEPR) system can serve as an effective low‐carbon development measure that leads to higher emission reduction and end‐products recovery.

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We develop a dynamic control model of a monopolist composed of two profit centers, e.g., an operations department in charge of the product innovation and a marketing department controlling advertising effort as well as the retail price. Meanwhile, knowledge accumulating in product innovation and advertising effort which lead to reducing the corresponding investment cost is considered. The customer inverse demand function depends jointly on the quality level as well as the product goodwill which can be improved by product innovation and advertising efforts. Our results show that the learning rates of product innovation and advertising effort affect the product innovation and advertising effort investments level. In addition, compared with the administered transfer-pricing, the negotiation between the two departments results in a lower transfer price as well as a higher retail price. In the meantime, the advertising effort is lower while the quality improvement effort is higher. What is more, higher profits to both departments and the firm can be brought about by the negotiation means.