Managing a Two-Echelon Supply Chain under the Impact of Consumer Environmental Awareness and Carbon Labeling

Abstract

Abstract. This paper concentrates on the impact of consumer environmental awareness (CEA) on the decision behaviors of the supply chain members and the channel coordination strategies within a one-retailer-one-manufacturer supply chain under carbon labeling system. Based on the newsvendor model, this study compares two decision scenarios: the centralized and the decentralized models. The results suggest that the decision behaviors of the supply chain members are not only related to CEA and carbon labeling system, but also rely on the choice of the supply chain construction. Further, in order to achieve the same profit as the centralized model, we consider a cost-sharing contract to coordinate the decentralized supply chain. Finally, Sensitivity analyses are conducted to examine the impacts of changes in both CEA and carbon labeling on the performance of the supply chain.