
-
Previous Article
Mean-field analysis of a scaling MAC radio protocol
- JIMO Home
- This Issue
-
Next Article
Multi-stage distributionally robust optimization with risk aversion
Optimal financing and operational decisions of capital-constrained manufacturer under green credit and subsidy
1. | Department of Information Management and Decision Sciences, School of Business Administration, Northeastern University, Shenyang 110169, China |
2. | State Key Laboratory of Synthetical Automation for Process Industries, Northeastern University, Shenyang 110819, China |
To stimulate the capital-constrained manufacturer to produce green products, the government often adopts two incentive mechanisms: green credit (i.e., subsidy offered directly to bank) and subsidy (i.e., subsidy offered directly to manufacturer). This paper examines the optimal interest rate of the bank, and the optimal product green degree and sales price of the manufacturer under the two mechanisms, respectively. Furthermore, we investigate the effects of these mechanisms on the optimal decisions, the profits of players, the social welfare and the environmental benefits. Several important results are obtained. First, when the total government subsidy is low, the green credit mechanism can bring the higher green degree, product sales price and demand, as well as higher profits for the bank and manufacturer, rather than the subsidy mechanism. Otherwise, the result is opposite. Second, the government should adopt the green credit mechanism to support the manufacturer to develop green products when the budget is limited and relatively low. If the government budget is sufficient, the subsidy mechanism is the best choice, which can bring higher economic and environmental benefits.
References:
[1] |
M. Aizawa and C. F. Yang,
Green credit, green stimulus, green revolution? China's mobilization of banks for environmental cleanup, J. Environ. Dev., 19 (2010), 119-144.
doi: 10.1177/1070496510371192. |
[2] |
B. Avci, K. Girotra and S. Netessine, Electric vehicles with a battery switching station: Adoption and environmental impact, Manage. Sci., 61 (2014), 772-794. Google Scholar |
[3] |
G. B. Bi, M. Y. Jin, L. Y. Ling and F. Yang,
Environmental subsidy and the choice of green technology in the presence of green consumers, Ann. Oper. Res., 255 (2017), 547-568.
doi: 10.1007/s10479-016-2106-7. |
[4] |
M. Burkart and T. Ellingsen,
In-kind finance: A theory of trade credit, Am. Econ. Rev., 94 (2004), 569-590.
doi: 10.1257/0002828041464579. |
[5] |
J. A. Buzacott and R. Q. Zhang,
Inventory management with asset-based financing, Manage. Sci., 50 (2004), 1274-1292.
doi: 10.1287/mnsc.1040.0278. |
[6] |
G. P. Cachon, Retail store density and the cost of greenhouse gas emissions, Manage. Sci., 60 (2014), 1907-1925. Google Scholar |
[7] |
E. Cao, L. X. Du and J. H. Ruan,
Financing preferences and performance for an emission-dependent supply chain: Supplier vs. bank, Int. J. Prod. Econ., 208 (2019), 383-399.
doi: 10.1016/j.ijpe.2018.08.001. |
[8] |
Y.-K. Che and I. Gale,
The optimal mechanism for selling to a budget-constrained buyer, J. Econ. Theory, 92 (2000), 198-233.
doi: 10.1006/jeth.1999.2639. |
[9] |
M. C. Cohen, R. Lobel and G. Perakis, The impact of demand uncertainty on consumer subsidy for green technology adoption, Manage. Sci., 62 (2016), 1235-1258. Google Scholar |
[10] |
S. Du, F. Ma, Z. Fu, L. Zhu and J. Zhang,
Game-theoretic analysis for an emission-dependent supply chain in a `cap-and-trade' system, Ann. Oper. Res., 228 (2015), 135-149.
doi: 10.1007/s10479-011-0964-6. |
[11] |
J. Z. Gao, Z. D. Xiao, B. B. Cao and Q. F. Chai,
Green supply chain planning considering consumer's transportation process, Transp. Res. Pt. e-Logist. Transp. Rev., 109 (2018), 311-330.
doi: 10.1016/j.tre.2017.12.001. |
[12] |
A. Hafezalkotob,
Direct and indirect intervention schemas of government in the competition between green and non-green supply chains, J. Clean Prod., 170 (2018), 753-772.
doi: 10.1016/j.jclepro.2017.09.124. |
[13] |
J. Hall,
Environmental supply chain dynamics, J. Clean Prod., 8 (2000), 455-471.
doi: 10.1016/S0959-6526(00)00013-5. |
[14] |
S. Huang, Z.-P. Fan and X. H. Wang,
The impact of transportation fee on the performance of capital-constrained supply chain under 3PL financing service, Comput. Ind. Eng., 130 (2019), 358-369.
doi: 10.1016/j.cie.2019.02.048. |
[15] |
B. Jing, X. F. Chen and G. S. Cai,
Equilibrium financing in a distribution channel with capital constraint, Prod. Oper. Manag., 21 (2012), 1090-1101.
doi: 10.1111/j.1937-5956.2012.01328.x. |
[16] |
P. R. Kleindorfer, K. Singhal and L. N. Van Wassenhove,
Sustainable operations management, Prod. Oper. Manag., 14 (2005), 482-492.
doi: 10.1111/j.1937-5956.2005.tb00235.x. |
[17] |
P. Kouvelis and W. H. Zhao,
The newsvendor problem and price-only contract when bankruptcy costs exist, Prod. Oper. Manag., 20 (2011), 921-936.
doi: 10.1111/j.1937-5956.2010.01211.x. |
[18] |
P. Kouvelis and W. H. Zhao,
Supply chain contract design under financial constraints and bankruptcy costs, Manage. Sci., 62 (2016), 2149-2455.
doi: 10.1287/mnsc.2015.2248. |
[19] |
V. Krishnan and W. Zhu,
Designing a family of development-intensive products, Manage. Sci., 52 (2006), 813-825.
doi: 10.1287/mnsc.1050.0492. |
[20] |
J.-Y. Liu, Y. Xia, Y. Fan, S.-M. Lin and J. Wu,
Assessment of a green credit policy aimed at energy-intensive industries in China based on a financial CGE model, J. Clean Prod., 163 (2017), 293-302.
doi: 10.1016/j.jclepro.2015.10.111. |
[21] |
R. Mahmoudi and M. Rasti-Barzoki,
Sustainable supply chains under government intervention with a real-world case study: An evolutionary game theoretic approach, Comput. Ind. Eng., 116 (2018), 130-143.
doi: 10.1016/j.cie.2017.12.028. |
[22] |
M. Parlar and Z. K. Weng,
Balancing desirable but conflicting objectives in the newsvendor problem, IIE Trans., 35 (2003), 131-142.
doi: 10.1080/07408170304380. |
[23] |
H. Peura, S. A. Yang and G. Lai,
Trade credit in competition: A horizontal benefit, M & SOM-Manuf. Serv. Oper. Manag., 19 (2017), 165-335.
doi: 10.1287/msom.2016.0608. |
[24] |
G. Raz and A. Ovchinnikov,
Coordinating pricing and supply of public interest goods using government rebates and subsidy, IEEE Trans. Eng. Manage., 62 (2015), 65-79.
doi: 10.1109/TEM.2014.2380999. |
[25] |
H. H. Song and X. X. Gao,
Green supply chain game model and analysis under revenue-sharing contract, J. Clean Prod., 170 (2018), 183-192.
doi: 10.1016/j.jclepro.2017.09.138. |
[26] |
C. S. Tang and S. Zhou,
Research advances in environmentally and socially sustainable operations, Eur. J. Oper. Res., 223 (2012), 585-594.
doi: 10.1016/j.ejor.2012.07.030. |
[27] |
Y.-C. Tsao, P.-L. Lee, C.-H. Chen and Z.-W. Liao,
Sustainable newsvendor models under trade credit, J. Clean Prod., 141 (2017), 1478-1491.
doi: 10.1016/j.jclepro.2016.09.228. |
[28] |
S.-C. Tseng and S.-W. Hung,
A strategic decision-making model considering the social costs of carbon dioxide emissions for sustainable supply chain management, J. Environ. Manage., 133 (2014), 315-322.
doi: 10.1016/j.jenvman.2013.11.023. |
[29] |
K. Wang, R. Q. Zhao and J. Peng,
Trade credit contracting under asymmetric credit default risk: Screening, checking or insurance, Eur. J. Oper. Res., 266 (2018), 554-568.
doi: 10.1016/j.ejor.2017.10.004. |
[30] |
D. D. Wu, L. Yang and D. L. Olson, Green supply chain management under capital constraint, Int. J. Prod. Econ., article in press.
doi: 10.1016/j.ijpe.2018.09.016. |
[31] |
N. Yan and B. Sun,
Comparative analysis of supply chain financing decisions between different financing modes, J. Ind. Manag. Optim., 11 (2015), 1073-1087.
doi: 10.3934/jimo.2015.11.1073. |
[32] |
D. Yang and T. Xiao, Pricing and green level decisions of a green supply chain with government interventions under fuzzy uncertainties, J. Clean Prod., 149 (2017), 1174-1187. Google Scholar |
[33] |
D.-X. Yang, Z.-Y. Chen, Y.-C. Yang and P.-Y. Nie,
Green financial policies and capital flows, Physica A, 522 (2019), 135-146.
doi: 10.1016/j.physa.2019.01.126. |
[34] |
H. Yang, W. Zhuo and L. Shao, Equilibrium evolution in a two-echelon supply chain with financially constrained retailers: The impact of equity financing, Int. J. Prod. Econ., 185 (2017), 139-149. Google Scholar |
[35] |
L. H. Zhang, J. G. Wang and J. X. You,
Consumer environmental awareness and channel coordination with two substitutable products, Eur. J. Oper. Res., 241 (2015), 63-73.
doi: 10.1016/j.ejor.2014.07.043. |
[36] |
W. G. Zhu and Y. J. He,
Green product design in supply chains under competition, Eur. J. Oper. Res., 258 (2017), 165-180.
doi: 10.1016/j.ejor.2016.08.053. |
show all references
References:
[1] |
M. Aizawa and C. F. Yang,
Green credit, green stimulus, green revolution? China's mobilization of banks for environmental cleanup, J. Environ. Dev., 19 (2010), 119-144.
doi: 10.1177/1070496510371192. |
[2] |
B. Avci, K. Girotra and S. Netessine, Electric vehicles with a battery switching station: Adoption and environmental impact, Manage. Sci., 61 (2014), 772-794. Google Scholar |
[3] |
G. B. Bi, M. Y. Jin, L. Y. Ling and F. Yang,
Environmental subsidy and the choice of green technology in the presence of green consumers, Ann. Oper. Res., 255 (2017), 547-568.
doi: 10.1007/s10479-016-2106-7. |
[4] |
M. Burkart and T. Ellingsen,
In-kind finance: A theory of trade credit, Am. Econ. Rev., 94 (2004), 569-590.
doi: 10.1257/0002828041464579. |
[5] |
J. A. Buzacott and R. Q. Zhang,
Inventory management with asset-based financing, Manage. Sci., 50 (2004), 1274-1292.
doi: 10.1287/mnsc.1040.0278. |
[6] |
G. P. Cachon, Retail store density and the cost of greenhouse gas emissions, Manage. Sci., 60 (2014), 1907-1925. Google Scholar |
[7] |
E. Cao, L. X. Du and J. H. Ruan,
Financing preferences and performance for an emission-dependent supply chain: Supplier vs. bank, Int. J. Prod. Econ., 208 (2019), 383-399.
doi: 10.1016/j.ijpe.2018.08.001. |
[8] |
Y.-K. Che and I. Gale,
The optimal mechanism for selling to a budget-constrained buyer, J. Econ. Theory, 92 (2000), 198-233.
doi: 10.1006/jeth.1999.2639. |
[9] |
M. C. Cohen, R. Lobel and G. Perakis, The impact of demand uncertainty on consumer subsidy for green technology adoption, Manage. Sci., 62 (2016), 1235-1258. Google Scholar |
[10] |
S. Du, F. Ma, Z. Fu, L. Zhu and J. Zhang,
Game-theoretic analysis for an emission-dependent supply chain in a `cap-and-trade' system, Ann. Oper. Res., 228 (2015), 135-149.
doi: 10.1007/s10479-011-0964-6. |
[11] |
J. Z. Gao, Z. D. Xiao, B. B. Cao and Q. F. Chai,
Green supply chain planning considering consumer's transportation process, Transp. Res. Pt. e-Logist. Transp. Rev., 109 (2018), 311-330.
doi: 10.1016/j.tre.2017.12.001. |
[12] |
A. Hafezalkotob,
Direct and indirect intervention schemas of government in the competition between green and non-green supply chains, J. Clean Prod., 170 (2018), 753-772.
doi: 10.1016/j.jclepro.2017.09.124. |
[13] |
J. Hall,
Environmental supply chain dynamics, J. Clean Prod., 8 (2000), 455-471.
doi: 10.1016/S0959-6526(00)00013-5. |
[14] |
S. Huang, Z.-P. Fan and X. H. Wang,
The impact of transportation fee on the performance of capital-constrained supply chain under 3PL financing service, Comput. Ind. Eng., 130 (2019), 358-369.
doi: 10.1016/j.cie.2019.02.048. |
[15] |
B. Jing, X. F. Chen and G. S. Cai,
Equilibrium financing in a distribution channel with capital constraint, Prod. Oper. Manag., 21 (2012), 1090-1101.
doi: 10.1111/j.1937-5956.2012.01328.x. |
[16] |
P. R. Kleindorfer, K. Singhal and L. N. Van Wassenhove,
Sustainable operations management, Prod. Oper. Manag., 14 (2005), 482-492.
doi: 10.1111/j.1937-5956.2005.tb00235.x. |
[17] |
P. Kouvelis and W. H. Zhao,
The newsvendor problem and price-only contract when bankruptcy costs exist, Prod. Oper. Manag., 20 (2011), 921-936.
doi: 10.1111/j.1937-5956.2010.01211.x. |
[18] |
P. Kouvelis and W. H. Zhao,
Supply chain contract design under financial constraints and bankruptcy costs, Manage. Sci., 62 (2016), 2149-2455.
doi: 10.1287/mnsc.2015.2248. |
[19] |
V. Krishnan and W. Zhu,
Designing a family of development-intensive products, Manage. Sci., 52 (2006), 813-825.
doi: 10.1287/mnsc.1050.0492. |
[20] |
J.-Y. Liu, Y. Xia, Y. Fan, S.-M. Lin and J. Wu,
Assessment of a green credit policy aimed at energy-intensive industries in China based on a financial CGE model, J. Clean Prod., 163 (2017), 293-302.
doi: 10.1016/j.jclepro.2015.10.111. |
[21] |
R. Mahmoudi and M. Rasti-Barzoki,
Sustainable supply chains under government intervention with a real-world case study: An evolutionary game theoretic approach, Comput. Ind. Eng., 116 (2018), 130-143.
doi: 10.1016/j.cie.2017.12.028. |
[22] |
M. Parlar and Z. K. Weng,
Balancing desirable but conflicting objectives in the newsvendor problem, IIE Trans., 35 (2003), 131-142.
doi: 10.1080/07408170304380. |
[23] |
H. Peura, S. A. Yang and G. Lai,
Trade credit in competition: A horizontal benefit, M & SOM-Manuf. Serv. Oper. Manag., 19 (2017), 165-335.
doi: 10.1287/msom.2016.0608. |
[24] |
G. Raz and A. Ovchinnikov,
Coordinating pricing and supply of public interest goods using government rebates and subsidy, IEEE Trans. Eng. Manage., 62 (2015), 65-79.
doi: 10.1109/TEM.2014.2380999. |
[25] |
H. H. Song and X. X. Gao,
Green supply chain game model and analysis under revenue-sharing contract, J. Clean Prod., 170 (2018), 183-192.
doi: 10.1016/j.jclepro.2017.09.138. |
[26] |
C. S. Tang and S. Zhou,
Research advances in environmentally and socially sustainable operations, Eur. J. Oper. Res., 223 (2012), 585-594.
doi: 10.1016/j.ejor.2012.07.030. |
[27] |
Y.-C. Tsao, P.-L. Lee, C.-H. Chen and Z.-W. Liao,
Sustainable newsvendor models under trade credit, J. Clean Prod., 141 (2017), 1478-1491.
doi: 10.1016/j.jclepro.2016.09.228. |
[28] |
S.-C. Tseng and S.-W. Hung,
A strategic decision-making model considering the social costs of carbon dioxide emissions for sustainable supply chain management, J. Environ. Manage., 133 (2014), 315-322.
doi: 10.1016/j.jenvman.2013.11.023. |
[29] |
K. Wang, R. Q. Zhao and J. Peng,
Trade credit contracting under asymmetric credit default risk: Screening, checking or insurance, Eur. J. Oper. Res., 266 (2018), 554-568.
doi: 10.1016/j.ejor.2017.10.004. |
[30] |
D. D. Wu, L. Yang and D. L. Olson, Green supply chain management under capital constraint, Int. J. Prod. Econ., article in press.
doi: 10.1016/j.ijpe.2018.09.016. |
[31] |
N. Yan and B. Sun,
Comparative analysis of supply chain financing decisions between different financing modes, J. Ind. Manag. Optim., 11 (2015), 1073-1087.
doi: 10.3934/jimo.2015.11.1073. |
[32] |
D. Yang and T. Xiao, Pricing and green level decisions of a green supply chain with government interventions under fuzzy uncertainties, J. Clean Prod., 149 (2017), 1174-1187. Google Scholar |
[33] |
D.-X. Yang, Z.-Y. Chen, Y.-C. Yang and P.-Y. Nie,
Green financial policies and capital flows, Physica A, 522 (2019), 135-146.
doi: 10.1016/j.physa.2019.01.126. |
[34] |
H. Yang, W. Zhuo and L. Shao, Equilibrium evolution in a two-echelon supply chain with financially constrained retailers: The impact of equity financing, Int. J. Prod. Econ., 185 (2017), 139-149. Google Scholar |
[35] |
L. H. Zhang, J. G. Wang and J. X. You,
Consumer environmental awareness and channel coordination with two substitutable products, Eur. J. Oper. Res., 241 (2015), 63-73.
doi: 10.1016/j.ejor.2014.07.043. |
[36] |
W. G. Zhu and Y. J. He,
Green product design in supply chains under competition, Eur. J. Oper. Res., 258 (2017), 165-180.
doi: 10.1016/j.ejor.2016.08.053. |





Non-subsidy | ||
Green credit | ||
Subsidy |
Non-subsidy | ||
Green credit | ||
Subsidy |
[1] |
Jian-Xin Guo, Xing-Long Qu. Robust control in green production management. Journal of Industrial & Management Optimization, 2020 doi: 10.3934/jimo.2021011 |
[2] |
Wei Chen, Yongkai Ma, Weihao Hu. Electricity supply chain coordination with carbon abatement technology investment under the benchmarking mechanism. Journal of Industrial & Management Optimization, 2020 doi: 10.3934/jimo.2020175 |
[3] |
Wenyan Zhuo, Honglin Yang, Leopoldo Eduardo Cárdenas-Barrón, Hong Wan. Loss-averse supply chain decisions with a capital constrained retailer. Journal of Industrial & Management Optimization, 2021, 17 (2) : 711-732. doi: 10.3934/jimo.2019131 |
[4] |
Hong Fu, Mingwu Liu, Bo Chen. Supplier's investment in manufacturer's quality improvement with equity holding. Journal of Industrial & Management Optimization, 2021, 17 (2) : 649-668. doi: 10.3934/jimo.2019127 |
[5] |
Nitha Niralda P C, Sunil Mathew. On properties of similarity boundary of attractors in product dynamical systems. Discrete & Continuous Dynamical Systems - S, 2021 doi: 10.3934/dcdss.2021004 |
[6] |
Andrew D. Lewis. Erratum for "nonholonomic and constrained variational mechanics". Journal of Geometric Mechanics, 2020, 12 (4) : 671-675. doi: 10.3934/jgm.2020033 |
[7] |
Buddhadev Pal, Pankaj Kumar. A family of multiply warped product semi-Riemannian Einstein metrics. Journal of Geometric Mechanics, 2020, 12 (4) : 553-562. doi: 10.3934/jgm.2020017 |
[8] |
Jann-Long Chern, Sze-Guang Yang, Zhi-You Chen, Chih-Her Chen. On the family of non-topological solutions for the elliptic system arising from a product Abelian gauge field theory. Discrete & Continuous Dynamical Systems - A, 2020, 40 (6) : 3291-3304. doi: 10.3934/dcds.2020127 |
[9] |
Ömer Arslan, Selçuk Kürşat İşleyen. A model and two heuristic methods for The Multi-Product Inventory-Location-Routing Problem with heterogeneous fleet. Journal of Industrial & Management Optimization, 2020 doi: 10.3934/jimo.2021002 |
[10] |
Bing Sun, Liangyun Chen, Yan Cao. On the universal $ \alpha $-central extensions of the semi-direct product of Hom-preLie algebras. Electronic Research Archive, , () : -. doi: 10.3934/era.2021004 |
[11] |
Touria Karite, Ali Boutoulout. Global and regional constrained controllability for distributed parabolic linear systems: RHUM approach. Numerical Algebra, Control & Optimization, 2020 doi: 10.3934/naco.2020055 |
[12] |
Chongyang Liu, Meijia Han, Zhaohua Gong, Kok Lay Teo. Robust parameter estimation for constrained time-delay systems with inexact measurements. Journal of Industrial & Management Optimization, 2021, 17 (1) : 317-337. doi: 10.3934/jimo.2019113 |
[13] |
Yuan Tan, Qingyuan Cao, Lan Li, Tianshi Hu, Min Su. A chance-constrained stochastic model predictive control problem with disturbance feedback. Journal of Industrial & Management Optimization, 2021, 17 (1) : 67-79. doi: 10.3934/jimo.2019099 |
[14] |
C. J. Price. A modified Nelder-Mead barrier method for constrained optimization. Numerical Algebra, Control & Optimization, 2020 doi: 10.3934/naco.2020058 |
[15] |
Helin Guo, Huan-Song Zhou. Properties of the minimizers for a constrained minimization problem arising in Kirchhoff equation. Discrete & Continuous Dynamical Systems - A, 2021, 41 (3) : 1023-1050. doi: 10.3934/dcds.2020308 |
[16] |
Hassan Mohammad. A diagonal PRP-type projection method for convex constrained nonlinear monotone equations. Journal of Industrial & Management Optimization, 2021, 17 (1) : 101-116. doi: 10.3934/jimo.2019101 |
[17] |
Zi Xu, Siwen Wang, Jinjin Huang. An efficient low complexity algorithm for box-constrained weighted maximin dispersion problem. Journal of Industrial & Management Optimization, 2021, 17 (2) : 971-979. doi: 10.3934/jimo.2020007 |
[18] |
Reza Lotfi, Zahra Yadegari, Seyed Hossein Hosseini, Amir Hossein Khameneh, Erfan Babaee Tirkolaee, Gerhard-Wilhelm Weber. A robust time-cost-quality-energy-environment trade-off with resource-constrained in project management: A case study for a bridge construction project. Journal of Industrial & Management Optimization, 2020 doi: 10.3934/jimo.2020158 |
2019 Impact Factor: 1.366
Tools
Article outline
Figures and Tables
[Back to Top]