Subsidizing strategies in a sustainable supply chain

Fu, Jiangfeng; Chen, Xiangfeng; Hu, Qiying

doi:10.1057/s41274-017-0199-2

Cited by 42 publications

(26 citation statements)

References 24 publications

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“…Shu et al [19], considering the consumer willingness to pay and the competition to recycle, investigates the influence of government subsidies on recycling used products and engaging in remanufacturing for local manufacturers and nonlocal manufacturers. Fu et al [20] compares the linear subsidy model and the fixed subsidy model, and explores the impacts of different subsiding policies on consumer surplus and social welfare. Zhao et al [21] establishes a decision model, considering both the subsidy and the consumer’s acceptance for remanufactured products, and finds that the sharing ratio of the subsidy depends on the percentage of environmentally conscious consumers.…”

Section: Literature Reviewmentioning

confidence: 99%

“…The government decides on an optimal unit subsidy to maximize social welfare benefits according to the response function of the manufacturer. Similar to [20], the social welfare faced by government is denoted as the sum of the manufacturer’s profits, retailer’s profits, and the consumer surplus ( CS ), less the government expenditure and the environment cost. Therefore, the social welfare function can be presented as: maxμ SWS=ΠMS*+ΠRS*+CSS*−μqrS*−vES* where CS is composed of the ordinary product consumer surplus and the remanufactured product consumer surplus.…”

Section: Model Formulation and Solutionmentioning

confidence: 99%

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Decisions of the Dual-Channel Supply Chain under Double Policy Considering Remanufacturing

Dai

Ding

et al. 2019

IJERPH

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Considering the preference of green consumers for remanufactured products, a dual-sale-channel supply chain model with government non-intervention, government remanufacturing subsidy policy, and carbon tax policy is constructed, respectively. The difference of the optimal decision between the firm and the government under the two policies is discussed in this paper. Meanwhile, we analyze the influence of green consumers on the government’s optimal decision, based on social welfare maximization. It is found that without government intervention, social welfare is the lowest. The carbon tax policy is better when the proportion of green consumers and the environmental coefficient are extreme or moderate at the same time. Otherwise, the subsidy policy is better. The carbon tax policy is more effective than the subsidy policy in controlling carbon emissions. Profit-sharing contracts should be established by enterprises and governments to achieve win–win results.

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Section: Literature Reviewmentioning

confidence: 99%

Section: Model Formulation and Solutionmentioning

confidence: 99%

Decisions of the Dual-Channel Supply Chain under Double Policy Considering Remanufacturing

Dai

Ding

et al. 2019

IJERPH

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“…The government's objective function includes the influence of profits for each member, the social aspect, i.e., consumer surplus (CS), and the total amount of the subsidy provided by the government organization [67,68]. The CS is the area of the demand curve below a given price, which can be expressed as…”

Section: Optimal Decisions In Policy Cmentioning

confidence: 99%

Game-Theoretic Analysis to Examine How Government Subsidy Policies Affect a Closed-Loop Supply Chain Decision

Nielsen

Majumder²,

Saha

2019

Applied Sciences

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The pros and cons of government subsidy policies in a closed-loop supply chain (CLSC) setting on optimal pricing, investment decisions in improving product quality, and used product collection under social welfare (SW) optimization goal have not been examined comprehensively. This study compares the outcomes of three government policies under manufacturer-Stackelberg (MS) and retailer-Stackelberg (RS), namely (i) direct subsidy to the consumer, (ii) subsidy to the manufacturer to stimulate used product collection, and (iii) subsidy to the manufacturer to improve product quality. Results demonstrate that the greening level, used product collection, and SW are always higher under the RS game, but the rate of a subsidy granted by the government is always higher under the MS game. Profits for the CLSC members and SW are always higher if the government provides a subsidy directly to the consumer, but productivity of investment in the perspective of the manufacturer or government are less. In a second policy, the government organizations grant a subsidy to the manufacturer to stimulate used product collection, but it does not necessarily yield the desired outcome compared to others. In a third policy, the manufacturer receives a subsidy on a research and development (R&D) investment, but it yields a sub-optimal greening level. This study reveals that the outcomes of subsidy policies can bring benefit to consumers and add a degree of complication for CLSC members; government organizations need to inspect carefully among attributes, mainly product type, power of CLSC members, and investment efficiency for the manufacturer, before implementing any subsidy policies so that it can lead to an environmentally and economically viable outcome.

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“…However, the manufacturer may be unwilling to spend money on advertising and marketing since this could reduce profits. To avoid this situation, we assume that the manufacturer can be granted a government subsidy for per unit low-carbon products sold [43,44]. Then, the manufacturer's profits in (3) and (6) can be modified as…”

Section: Further Extensionmentioning

confidence: 99%

Optimal Decisions for Carbon Emission Reduction through Technological Innovation in a Hybrid-Channel Supply Chain with Consumers’ Channel Preferences

Xin

Zhou

Zhu

et al. 2019

Discrete Dynamics in Nature and Society

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This paper integrates carbon emission reduction via technological innovation with consumer channel preferences in both single- and dual-channel supply chains selling low-carbon products. Linear demand functions which simultaneously reflect the consumers’ channel preferences and low-carbon sensitivity are developed by considering the consumers’ segmentation. On this basis, we present two Stackelberg game models: one for each of the single- and dual-channel supply chains. In the first, the manufacturer sells low-carbon products through a traditional retailer who has a physical store, while in the second the manufacturer opens an online direct channel to compete with the traditional retailer. For the two models developed, the optimal pricing decisions, carbon emission reduction level, and profits are derived and discussed. Numerical examples are given to verify the effectiveness and practicality of the proposed models and solutions. The results show that supply chain members’ profits are affected by system parameters such as the carbon price, consumers’ low-carbon sensitivity, channel preference, etc. Furthermore, although the aforementioned parameters stimulate the manufacturer to reduce carbon emission, this does not always benefit the retailer. Comparison of the two models indicates that dual-channel selling is only the better choice for both the manufacturer and the retailer under certain conditions.

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Subsidizing strategies in a sustainable supply chain

Cited by 42 publications

References 24 publications

Decisions of the Dual-Channel Supply Chain under Double Policy Considering Remanufacturing

Decisions of the Dual-Channel Supply Chain under Double Policy Considering Remanufacturing

Game-Theoretic Analysis to Examine How Government Subsidy Policies Affect a Closed-Loop Supply Chain Decision

Optimal Decisions for Carbon Emission Reduction through Technological Innovation in a Hybrid-Channel Supply Chain with Consumers’ Channel Preferences

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