A study on the profit distribution mechanism of the resource - Based supply chain considering low-carbon constraints and ecological restoration

Elsevier, Resources Policy, Volume 74, December 2021
Yao L., He L., Chen X., Yang L.

With the rapid development of China's economy, it has become crucial to achieve the right balance between economic development and environmental protection. Green growth is a significant approach to addressing the relationship between economic development and the environment. Low-carbon development and ecological protection are two essential aspects of green development, and they tremendously impact enterprises' resource-based supply chain. Hence, this paper seeks to explore the revenue distribution mechanism of the resource-based supply chain in the context of green development. Given a bi-level resource-based supply chain composed of resource developers and resource processors, the study examines, in the context of low-carbon development, the impacts of both emission reduction and ecological restoration levels on the expected returns of the supply chain. Using game theory, we construct a decentralized decision-making equilibrium model under the three kinds of market structures (that is, a market led either by the upper or lower level or by the balanced levels of the chain), and then establish a centralized decision-making equilibrium model. The results show that the overall profits of the supply chain are maximized through centralized decision-making.