Suppliers’ equilibrium carbon abatement investment in the food supply chain network with the government subsidy

Xiaotong Guo, Yong He and Dong Li

International Journal of Production Research, 2025, vol. 63, issue 22, 8429-8451

Abstract: This paper analyzes the food supplier’s equilibrium carbon abatement investment decisions, supply chain members’ profits, consumer surplus, and carbon emissions under the scenario with and without the government subsidy. Our results reveal that the marginal carbon abatement cost is a key determinant of the suppliers’ equilibrium decisions and supply chain performance. The influence of this factor varies with the supply chain network size. The deterioration of food quality will reduce each supplier’s carbon abatement investment and will incur negative effects on the whole supply chain network’s performance. Furthermore, our results demonstrate the effectiveness of the government subsidy in improving economic and social performance. The government subsidy can improve the carbon abatement investment level and supply chain members’ profits while the effectiveness may be reduced in a larger network size. Implementing the government subsidy can also benefit the consumer surplus while increasing the whole supply chain network’s total carbon emissions under certain conditions. Furthermore, the government subsidy cannot mitigate the adverse effects of multiple suppliers’ competition in the context of larger network size. Our results reveal that alleviating suppliers’ competition is better than only reducing carbon abatement costs or educating consumers about environmental awareness.

Date: 2025
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DOI: 10.1080/00207543.2025.2504164

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