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Impacts of financing mechanism and power structure on supply chains under cap-and-trade regulation

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  • Tang, Ruihong
  • Yang, Lei

Abstract

This paper develops a low-carbon supply chain consisting of a capital-constrained manufacturer and a capital-abundant retailer where bank loans and early payment are investigated. Under each power structure, there always exists a financing equilibrium, i.e., early payment. Compared with bank loans, early payment could produce lower carbon emissions and higher social welfare in the retailer-led power structure; but it damages environment and social welfare, and leads to the conflict between profitability and environmental goals in the manufacturer-led case. Finally, impacts of power structure on financing mechanism, carbon emissions, and performance are analyzed to provide more managerial implications.

Suggested Citation

  • Tang, Ruihong & Yang, Lei, 2020. "Impacts of financing mechanism and power structure on supply chains under cap-and-trade regulation," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 139(C).
    • Handle: RePEc:eee:transe:v:139:y:2020:i:c:s1366554520306086
    DOI: 10.1016/j.tre.2020.101957
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