Production and carbon emission abatement decisions under different carbon policies: supply chain network equilibrium models with consumers’ low‐carbon awareness

Abstract

With the increasing requirements for environmental protection, authorities have enacted different carbon policies to promote sustainable practices. This study considers the competition among different manufacturers and multiple demand markets in the supply chain network. We examine and compare their equilibrium decision conditions under three common carbon policies: carbon cap, carbon cap‐and‐trade, and carbon tax. Results suggest that under lower carbon caps, manufacturers greatly reduce their carbon emissions by reducing production quantities, which causes a decrease in profits. However, an appropriate carbon cap size can not only motivate manufacturers to reduce carbon emissions but also improve their profits. Under a certain price for carbon credit, the effectiveness of a carbon cap‐and‐trade policy is similar to that of a carbon cap policy, but it has more flexibility. Carbon tax is effective, but it brings more tax burden to manufacturers. We provide implications for companies to optimize their production methods to achieve sustainability.

Strategic analysis of green technology unilateral licensing under carbon cap‐and‐trade policy

“…Mondal and Giri (2022b) presented a two‐echelon closed‐loop supply chain model consisting of one manufacturer and two competing retailers and developed centralized and manufacturer‐led decentralized policies. Yang and Xu (2023) considered a supply chain network with multiple manufacturers and multiple demand markets in competition and studied competitive relationships and equilibrium conditions of different decision‐makers in supply chain network under carbon policies. Li et al (2023) considered consumers' loss aversion in environmental quality and developed a two‐period game theoretical model to investigate the optimal pricing and environmental quality decisions for a green supply chain where a manufacturer sells products to consumers through a retailer.…”

Avenues of decarbonisation in the dynamics of processed food supply chains: Towards responsible production consumption

“…(PR9) Joshi et al [ 71 ]; Mahroof et al [ 72 ]; Martin-Rios et al [ 73 ]; Gupta et al [ 74 ] Distribution initiatives (H4) Low carbon distribution logistics practices. (PR10) Yang and Xu [ 75 ]; Tavassoli et al [ 76 ]; Kashyap and Agarwal [ 77 ] Traceability and monitoring of the food items. (PR11) Zhou et al [ 78 ]; Lawo et al [ 79 ]; Sharma and Jayant [ 80 ]; Kamilaris et al [ 81 ] Customer-based (H5) Preferences for the product binding sustainability.…”

Emission Reduction Decisions in Blockchain-Enabled Low-Carbon Supply Chains under Different Power Structures

“…Therefore, how to achieve carbon emission reduction under the premise of ensuring economic benefits has become an urgent problem for supply chain enterprises. At present, many scholars have studied carbon emission reduction strategies for supply chains from various perspectives, such as low-carbon policy [2,[9][10][11], consumers' low-carbon preferences [12,13], and supply chain coordination mechanisms [14,15]. Wang et al [2] used differential games to study the carbon emission reduction decisions of construction supply chains under government subsidies.…”

“…Sun et al [12] analyzed the relationship between consumers' preferences for low carbon and the timeliness of carbon emitting technologies on the carbon transfer behavior of manufacturers and suppliers. Yang and Xu [13] researched the impact of consumers' low carbon preferences on product production and carbon emission reduction decisions. Liu et al [4] illustrated that under the low carbon preferences of consumers, the carbon emission reduction cost sharing strategy could improve the sales volume and profit of retailers, as well as enhance the cooperative relationship between supply chain enterprises.…”