Journal article

Coordinated pricing analysis with the carbon tax scheme in a supply chain

X Ma, W Ho, P Ji, S Talluri

Decision Sciences | Wiley | Published : 2018


The carbon tax is a cost-efficient scheme to curb emissions, and it has been implemented in Australia, British Columbia, and other places worldwide. We aim to analyze its effect on dynamic pricing in a supply chain with multiple suppliers and one manufacturer. The profit-maximizing manufacturer makes final products using raw materials from suppliers with heterogeneous prices and emission rates. A two-stage game model is built over an infinite time horizon for this issue. In the first stage, suppliers face price-dependent demand to set their prices and production rates under the constraint of inventory capacity. Then, in response to the carbon tax scheme, the manufacturer evaluates the procur..

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Funding Acknowledgements

We thank two reviewers, the Associate Editor, the Senior Editor, and the Editor for their constructive feedback. We also acknowledge The Hong Kong Polytechnic University for the financial support of the projects G-RTES and G-UA7A, and The University of Melbourne for the Top Journal R&R Award.