Optimal Pricing, Ordering, and Coordination for Prefabricated Building Supply Chain with Power Structure and Flexible Cap-and-Trade

Wen Jiang, Menglin Liu, Lu Gan and Chong Wang
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Wen Jiang: College of Architecture and Urban-Rural Planning, Sichuan Agricultural University, Chengdu 611830, China
Menglin Liu: College of Architecture and Urban-Rural Planning, Sichuan Agricultural University, Chengdu 611830, China
Lu Gan: College of Architecture and Urban-Rural Planning, Sichuan Agricultural University, Chengdu 611830, China
Chong Wang: Business and Tourism School, Sichuan Agricultural University, Chengdu 611830, China

Mathematics, 2021, vol. 9, issue 19, 1-22

Abstract: Under the increasing pressure of global emission reduction, prefabricated buildings are becoming more and more popular. As prefabricated building manufacturers and assemblers are emerging in the market, how do they make decisions of pricing, ordering, and emission reduction? In this paper, game theory is used to make the decisions for the prefabricated building supply chain with flexible cap-and-trade and different power structures, i.e., using prefabricated building manufacturers as the leader, using the vertical Nash equilibrium, and using prefabricated building assemblers as the leader. The two-part tariff contract is designed to coordinate the supply chain and to improve the supply chain performance. Moreover, we discuss the influence of different power structures and the two-part tariff contract on the optimal decisions and profits. Finally, numerical analysis is used to verify the conclusions. This indicates that the supply chain leaders will gain a higher profit and that the power structure has a significant influence on the two-part tariff contract, which will result in an unfair distribution of profit. High carbon trading prices benefit carbon emission reduction. Consumer low-carbon awareness has a positive effect on carbon emission reduction and supply chain performance.

Keywords: prefabricated building; flexible cap-and-trade; supply chain coordination; power structure; two-part tariff contract (search for similar items in EconPapers)
JEL-codes: C (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)

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