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Impact of Green Credit Financing and Carbon Emission Limits on the Supply Chain Based on POF

Author

Listed:
  • Liurui Deng

    (School of Business, Hunan Normal University, Changsha 410006, China)

  • Lan Yang

    (School of Economics and Trade, Hunan University, Changsha 410079, China)

  • Wei Li

    (School of Economics and Trade, Hunan University, Changsha 410079, China)

Abstract

In recent years, environmental protection has been paid more and more attention. Green credit policy (GCP) is one of the significant preferential policies for government to encourage enterprises to vigorously develop green projects. We are interested in the impact of the central bank’s GCP on the profits and optimal strategies of manufacturers and suppliers related to POF (purchase order financing). Specifically, we build a game-theoretical model consisting of a manufacturer, a bank and a green supplier and a non-green supplier. Furthermore, the optimal strategies of the manufacturer and suppliers when the bank or the government sets a carbon emission cap on suppliers are discussed. We come to some important conclusions about a GCP that promotes the development of green projects since it brings higher profits to both the manufacturer and suppliers than the lack of a GCP. Furthermore, the higher the production cost, the better the effect of a GCP. Under the carbon emission restrictions required by the government, the effect of GCP is weakened and the profits of the manufacturer and the suppliers are reduced to zero due to the gradually increasing delivery risks as production costs increase.

Suggested Citation

  • Liurui Deng & Lan Yang & Wei Li, 2021. "Impact of Green Credit Financing and Carbon Emission Limits on the Supply Chain Based on POF," Sustainability, MDPI, vol. 13(11), pages 1-20, May.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:11:p:5814-:d:559721
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    References listed on IDEAS

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    Cited by:

    1. Junjian Wu & Jennifer Shang, 2021. "Green Credit Financing Equilibrium under Government Subsidy and Supply Uncertainty," Sustainability, MDPI, vol. 13(22), pages 1-22, November.
    2. Liurui Deng & Wentang Xu & Juan Luo, 2021. "Optimal Loan Pricing for Agricultural Supply Chains from a Green Credit Perspective," Sustainability, MDPI, vol. 13(22), pages 1-21, November.

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