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The Impacts of Regulations and Financial Development on the Operations of Supply Chains with Greenhouse Gas Emissions

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  • Zhuang Xiao

    (School of Management and Economics, University of Electronic Science and Technology of China, Chengdu 610054, China
    School of Management and Economics, Chongqing University of Arts and Sciences, Yongchuan 402160, China)

  • Yixiang Tian

    (School of Management and Economics, University of Electronic Science and Technology of China, Chengdu 610054, China)

  • Zheng Yuan

    (School of Management and Economics, University of Electronic Science and Technology of China, Chengdu 610054, China)

Abstract

To establish a micro foundation to understand the impacts of greenhouse gas (GHG) emission regulations and financial development levels on firms’ GHG emissions, we build a two-stage dynamic game model to incorporate GHG emission regulations (in terms of an emission tax) and financial development (represented by the corresponding financing cost) into a two-echelon supply chain. With the subgame perfect equilibrium, we identify the conditions to determine whether an emission regulatory policy and/or financial development can affect GHG emissions in the supply chain. We also reveal the impacts of the strictness of GHG emission regulation, the financial development level, and the unit GHG emission rate on the operations of the supply chain and the corresponding profitability implications. Managerial insights are also discussed.

Suggested Citation

  • Zhuang Xiao & Yixiang Tian & Zheng Yuan, 2018. "The Impacts of Regulations and Financial Development on the Operations of Supply Chains with Greenhouse Gas Emissions," IJERPH, MDPI, vol. 15(2), pages 1-18, February.
    • Handle: RePEc:gam:jijerp:v:15:y:2018:i:2:p:378-:d:132775
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    Cited by:

    1. Ning Zhang & Zaiwu Gong & Kedong Yin & Yuhong Wang, 2018. "Special Issue “Decision Models in Green Growth and Sustainable Development”," IJERPH, MDPI, vol. 15(6), pages 1-8, May.

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