The Impact of Equity Financing on the Performance of Capital-Constrained Supply Chain under Consumers’ Low-Carbon Preference

Xiaoli Zhang, Guoyi Xiu, Fakhar Shahzad and Caiquan Duan
Additional contact information
Xiaoli Zhang: School of Economics and Management, Harbin University of Science and Technology, Harbin 150080, China
Guoyi Xiu: School of Economics and Management, Harbin University of Science and Technology, Harbin 150080, China
Caiquan Duan: College of Engineering, Northeast Agricultural University, Harbin 150030, China

IJERPH, 2021, vol. 18, issue 5, 1-22

Abstract: The reduction in carbon emissions by industrial enterprises is an important means for promoting environmental protection and achieving sustainable development. To determine the impact of carbon emissions reduction on supply chain operation and financing decision-making, in this study we designed three financing strategies, i.e., bank loan financing, equity financing, and hybrid financing (a combination of bank loan financing and equity financing), for a manufacturer (leader) and a low-carbon supply chain composed of a capital-constrained retailer, constructed Stackelberg game models, solved the equilibrium results under each financing strategy using the reverse recursion method, and revealed the financing preference of the supply chain member companies through comparative analysis. The results showed that the increase in the consumers’ low-carbon preference and equity financing ratio have positive impacts on supply chain equilibrium, a result that is opposite that for the impact of the interest rate of bank loan financing; additionally, the abovementioned three factors jointly determine the profit of the manufacturer of the low-carbon supply chain, while the retailer’s profit is affected by the equity dividend ratio. Finally, we present the conditions for the financing preference of the manufacturer and the retailer. The findings of this study can provide references for low-carbon supply chain companies to make appropriate management decisions.

Keywords: low-carbon preference; capital constraint; bank loan; equity financing; hybrid financing (search for similar items in EconPapers)
JEL-codes: I I1 I3 Q Q5 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://www.mdpi.com/1660-4601/18/5/2329/pdf (application/pdf)
https://www.mdpi.com/1660-4601/18/5/2329/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jijerp:v:18:y:2021:i:5:p:2329-:d:506961

Access Statistics for this article

IJERPH is currently edited by Ms. Jenna Liu

More articles in IJERPH from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().