Investment Game Model Analysis of Emission-Reduction Technology Based on Cost Sharing and Coordination under Cost Subsidy Policy

Shan Yu, Qiang Hou and Jiayi Sun
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Shan Yu: School of Management, Shenyang University of Technology, Shenyang 110870, China
Qiang Hou: School of Management, Shenyang University of Technology, Shenyang 110870, China
Jiayi Sun: School of Management, Shenyang University of Technology, Shenyang 110870, China

Sustainability, 2020, vol. 12, issue 6, 1-19

Abstract: Climate change and greenhouse gas emission reduction have become common concerns. Carbon trading systems and low-carbon cost subsidies are important emission reduction measures. Impacts of a combination of the two policies on micro-supply chain emission-reduction technology investment have become a focal research area. This paper: (1) constructs an investment game model based on cost-sharing coordination under a cost subsidy between manufacturers and retailers; (2) examines the equilibrium strategy and optimal results according to the interests and game relationships of each stakeholder; and (3) explores the effectiveness of supply chain enterprise behavior based on cost-sharing coordination under the cost subsidy. This paper uses a numerical simulation method to compare the path evolution under different scenarios and to analyze the sensitivity of parameters, identifying the influence of various parameters on the general structure and pathways. The study finds that the cost subsidy policy has a regulatory effect on enterprise emission reduction investment and enterprise profit under a carbon trading system, and the difference caused by the regulation effect is enhanced over time. The study also shows that the dynamic path of each parameter strengthens over time.

Keywords: carbon emission trading system; cost subsidy; investment of emission reduction technology; differential game theory; climate change (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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