Low-carbon supply chain optimization considering warranty period and carbon emission reduction level under cap-and-trade regulation

Shaojian Qu, Hui Yang () and Ying Ji
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Shaojian Qu: Nanjing University of Information Science and Technology
Hui Yang: University of Shanghai for Science and Technology
Ying Ji: University of Shanghai for Science and Technology

Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, 2021, vol. 23, issue 12, No 39, 18040-18067

Abstract: Abstract Greenhouse gas emissions have gradually became an important problem hindering the sustainable development of human beings. This paper considers the carbon emissions generated by the manufacturer during the product warranty process. The impacts of cap-and-trade regulation on product warranty policy and carbon emission reduction strategy are studied. According to Stackelberg theory, two supply chain game models are established. In Model I, market demand only depends on the selling price and warranty period of the product. In Model II, the carbon emission reduction level of the product is also considered as a new important factor affecting market demand. The optimal decisions of Model I and Model II in the centralized and decentralized game structure are solved and a revenue-sharing contract is proposed to coordinate the low-carbon supply chain. According to theory analysis, the following conclusions are obtained: (1) Compared with Model I, the key decisions in Model II have better response. (2) Under all game structures, the products in the centralized scheme have higher carbon emission reduction levels and warranty periods. (3) The unit carbon trading price has a negative correlation with the carbon emission reduction level and warranty period of the product. Eventually, through a set of numerical experiments, the validity of the proposed contract is verified and sensitivity analysis on key parameters of the optimal strategies of the two models under different game policies is performed.

Keywords: Warranty period; Carbon emission; Cap-and-trade regulation; Coordination policy; Optimal decision (search for similar items in EconPapers)
Date: 2021
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DOI: 10.1007/s10668-021-01427-8

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