Government regulation to promote coordinated emission reduction among enterprises in the green supply chain based on evolutionary game analysis

Liu, Z. and Qian, Q. and Hu, B. and Shang, W.-l. and Li, L. and Zhao, Y. and Zhao, Z. and Han, Chunjia (2022) Government regulation to promote coordinated emission reduction among enterprises in the green supply chain based on evolutionary game analysis. Resources, Conservation & Recycling 182 , ISSN 0921-3449.

Abstract

The green supply chain realizes the unification of economic and environmental benefits through green manufacturing, green circulation and reverse logistics, and represents an important way to reduce emissions. The characteristics of the green supply chain network, however, can encourage some companies to exhibit “free- riding” behavior, participating without being willing to reduce emissions directly themselves. This paper applies an evolutionary game model to a two-level green supply chain composed of green suppliers and green manufacturers in order to analyze a variety of internal and external factors that affect the behavior of both parties in the game, and thence numerically simulate the evolution and stability trend of coordinated reductions in emissions. The results identify many cases of system evolution but the only stable evolution strategy is when both (1) the sum of collaborative emission reduction benefits and government subsidies is greater than the sum of collaborative emission reduction input costs and "free rider" benefits, and (2) the increased rate of unilateral emission reduction benefits is greater than the ratio of costs to original benefits. Income arising from collaborative reductions in emissions, enterprise original income, income from unilateral reductions in emissions in- crease ratio, government subsidy coefficient and achievement reward base can directly affect the system evolution path. The larger these value, the greater the probability of green suppliers and green manufacturers choosing collaborative reductions in emissions, and the faster the system convergence speed. Only the imposition of regulatory punishments above the threshold will affect the "free riding" behavior of enterprises and drive the upstream and downstream enterprises of the green supply chain to reduce emissions faster.

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