Platform's role in green vs. non-green product competition: Blockchain transparency and selling contract selection

Jianghua Wu, Junzhu Yao and Yuqian Wang

International Journal of Production Economics, 2025, vol. 288, issue C

Abstract: By enhancing transparency, blockchain facilitates product greenness verification, boosting consumer trust and willingness to pay for greener products. This study examines the impact of blockchain transparency and asymmetric selling contracts on upstream competition and free-riding effects, focusing on greenness and supply chain profits. In our model, the downstream platform offers reselling or agency contracts to the asymmetric green and non-green suppliers. First, the findings reveal that under a low (high) commission rate, a reselling contract for the non-green supplier and an agency (reselling) contract for the green supplier is most effective in enhancing greenness. Second, blockchain adoption consistently increases the non-green supplier's profits but does not always benefit the green supplier. Notably, higher blockchain costs reduce the green supplier's profits but may increase the non-green supplier's profits. Third, platform profitability varies with market conditions, and each of the four contract forms can become optimal under certain conditions. Specifically, a reselling contract with the green supplier is optimal under a low commission rate but shifts to an agency contract as the rate rises, while the non-green supplier undergoes this shift at a higher rate threshold. Notably, at an extremely high commission rate and blockchain transparency, reverting to a reselling contract with the green supplier maximizes platform profits. Finally, under a moderately low commission rate and high transparency, combining a reselling contract for the non-green supplier with an agency contract for the green supplier achieves the highest greenness while aligning with optimal strategies for platform profitability and overall supply chain efficiency.

Keywords: Green supply chain; Agency contract; Reselling contract; Blockchain (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:proeco:v:288:y:2025:i:c:s0925527325001884

DOI: 10.1016/j.ijpe.2025.109703

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