Effects of government regulations on Manufacturer's behaviors under carbon emission reduction

Can the extension of the global value chain production length promote carbon emissions reduction in China's equipment manufacturing industry?

In the context of localization of Global Value Chain (GVC) and stricter carbon emission requirements, the impact of participating in GVC on carbon emission reduction has become one of the most crucial criteria for China's manufacturing industry to consider whether to deepen its participation in GVC. In order to clearly and directly reflect the change in the production distance between the original input and the final product, we use the GVC production length to express the degree of participation in GVC. And in order to make the research more targeted and typical, we select the equipment manufacturing industry as the research object. Using the data from the World Input-Output Database (WIOD), we empirically analyze the GVC production length under different cross-border production activities on the basis of the theoretical mechanism. The results show that the extension of the GVC production length can significantly promote the carbon emissions reduction. In the decomposition part, the extension of simple GVC production length can effectively promote carbon emissions reduction. Therefore, it is suggested that China's equipment manufacturing industry should continue to deeply participate in the high-end production links of GVC and improve its status in the complex GVC production activities.

Green pharmaceutical supply chain coordination considering green investment, green logistics, and government intervention

Despite their important role in the fight against global climate change, the coordination of green pharmaceutical supply chains (GPSC) has rarely been studied. To fill this research gap and realize the optimal green performance of GPSC, this study aimed to investigate the coordination of a GPSC considering green investment, green logistics, and government intervention. Using a game-theoretic approach, we establish decision models and analyze the equilibrium strategies in several GPSC scenarios. A linked two-part tariff (LTPT) contract is proposed for the coordination of the GPSC. In addition, we explore the many important implications of changes in the parameters. This research shows that, under different conditions, governments should reasonably implement different interventions in order to promote the positive global performance of GPSC. Government intervention can increase the benchmark height and make more room for green improvement. The proposed LTPT contract can assist in the realization of GPSC coordination, obtain a greater consumer surplus, and achieve optimal green performance. Higher flexibility-influence coefficients of green degree on costs are conducive to the emission reductions and sustainable development of GPSC. Moreover, cultivating green preference in the market can save the government expenditures on subsidies. When the green investment coefficient of a GPSC is larger, the GPSC members lack motivation for green improvement, and the government needs to provide more subsidies rather than taxes in order to improve the green degree of the GPSC. Increased rewards from the government to the pharmaceutical manufacturer and the TPLSP will reduce the subsidies for the pharmaceutical retailer. Government intervention influences the scope of an LTPT contract. The findings provide rich managerial insights and implications for the GPSC policymakers and decision-makers in achieving sustainability goals.

Waste converting through by-product synergy: an insight from three-echelon supply chain

By-product synergy (BPS) is an innovative method to convert waste into valuable by-products effectively. Based on a three-echelon supply chain composed of an upstream manufacturer, a processing plant with limited processing capacity, and a downstream manufacturer, this study derives the production quantity and waste disposal decisions of the upstream and downstream manufacturers as well as the optimal transfer price decision of the processing plant. Moreover, we assess the environmental performance of BPS. Analytical results suggest that the upstream manufacturer's production quantity and waste disposal decisions and the processing plant's transfer price decision are threshold dependent on the processing plant's capacity, whereas the downstream manufacturer's production quantity decision is threshold dependent on the processing plant's capacity and price of raw materials. BPS is beneficial for all members of the supply chain to increase profit. The production promotion and cost-saving effects ensure that the supply chain members maximize their profit. However, BPS does not always have a positive effect on the environment; when the processing plant's capacity and price of raw materials are below the threshold, implementing BPS results in a win-win situation of economic and environmental benefits.

Evolutionary game analysis of coal enterprise resource integration under government regulation

Resource integration of coal enterprises is conducive to reducing pollution and carbon emissions, thus alleviating environmental problems such as global warming. Government regulation has a great influence on enterprise behavior. Therefore, it is necessary to analyze the strategies of government and coal enterprises in resource integration. Based on the perspective of government regulation, this paper discusses how to guide and restrict coal enterprises to conduct resource integration behavior, and whether the government supervises this behavior. First, through empirical research, government regulations of coal enterprises are given practical policy implications. Second, using evolutionary game and simulation technology, from the perspective of government regulation, we explore the complex behavioral interaction mechanism between the dominant and inferior coal enterprises, the mechanism between the government and coal enterprises, and analyze the impact of key factors on the dynamic evolution process. Finally, the sensitivity analysis of the selected parameters is discussed in details, which provides useful decision-making suggestions for the government and enterprises. In addition, this paper further analyzes the impact of different government policies on coal enterprises' green innovation strategies. Results demonstrate that (1) when the power gap between enterprises is large, the probability of dominant enterprises choosing resource integration converges to 1, while the probability of inferior enterprises converges to 0. Therefore, government regulations are invalid for inferior enterprises; (2) the combination of government regulations can help improve the efficiency of coal enterprises' strategic choices. With the increase in the intensity of government rewards and punishments, the probability of enterprise resource integration evolves from 0 to 1; (3) excessive government regulations make the choice between the government and coal companies tend to swing, because the probability of the two is between 0 and 1. Therefore, excessive government regulations cannot effectively achieve resource integration and government regulation. (4) The government subsidy strategy is less effective than the government's pollution penalty strategy in promoting the green innovation of enterprises. Our research shows that the government should choose different policy combinations and intensities to regulate resource integration according to the market power of coal enterprises, which provides theoretical reference and practical guidance for the government to regulate corporate resource integration behavior.

Modeling drivers for successful adoption of green business: an interpretive structural modeling approach

Like most other developing countries, Bangladesh is facing tremendous pressure to mitigate climate change effects and prior environmental degradation, further creating a vulnerable condition in mitigating its environmental, social, and economic circumstances. Green business approaches could be one of the better weapons for these severe conditions as they quantify the incorporation of environmental and social concerns without compromising economic development. They have gained considerable attention from governments, industries, and researchers over the past few years. The main aim of this paper is designed to build up a structured model (interpretive structural modeling) of drivers for adopting green business (GB) in the context of emerging economies. The interpretive structural modeling (ISM) will allow the assessors in the regulatory, market, and other sectors to promote the smooth utilization of green business strategies by defining and recognizing the linkages among the drivers associated with the green business. The driver's intimate relationship enables a hierarchy by compiling their dependence and driving power. For demonstrating the structural modeling for the identified drivers, we used combined "Matriced' Impacts Croisés Multiplication Appliquée á un Classement" (MICMAC) analysis and ISM model for characterizing the drivers as indicated by their driving and dependence power. Throughout, the evaluation of the available literature followed by a discussion with experts (both industrial and academic) was done for the identification of the drivers for green business adoption. A structured model (ISM) and MICMAC (as fuzzy analytical tools) analysis are required to give a boon set of knowledge to the assessors of the legislature and business industry, which further lead them for resource maximization in a sustainable way to embrace green strategies into their core business process.

Implementation of a Multi-Agent Carbon Emission Reduction Strategy under the Chinese Dual Governance System: An Evolutionary Game Theoretical Approach

A central-local dual governance system is the basic system of environmental governance in China. Co-governance between the central environmental protection department (CEPD) and local environmental protection departments (LEPDs) is an important means to effectively promote China's carbon emission reduction strategy. Accordingly, this paper discusses their interactive decision-making and investigates how to optimize the strategic relationships between the CEPD, LEPDs, and carbon emission enterprises (CEEs) under the dual governance system by constructing a trilateral evolutionary game model and analyzing evolutionary stability strategies, achieving a numerical experiment simulation of evolution processes and determining the impacts of various factors using MATLAB, leading to several countermeasures and suggestions. The results indicate that the CEPD should rationally use the incentive mechanism for LEPDs, improve the carbon tax system, and further penalize the nepotistic relationship of LEPDs and CEEs. Furthermore, it is essential to reform the current LEPD performance evaluation system and reduce the cost of LEPD positive regulation through subsidies and financial transfer payments. Additionally, the CEE strategy is affected by carbon reduction tax rates, penalties, subsides, and emission reduction costs and revenues. This study reveals the consequences of interactions between CEPD, LEPDs, and CEEs and presents options for the redesign of incentive and regulatory mechanisms to improve carbon emission reduction performance in China.

Remanufacturing under energy performance contracting-an alternative insight from sustainable production

Remanufacturing and energy performance contracting (EPC) have attracted much attention recently because of their potential to reduce energy consumption and achieve sustainable production. In this paper, taking carbon emission trading (CET) into consideration, we discussed how EPC affected manufacturer production decision-making. We constructed an optimal production model and analyzed the manufacturer's production decision-making, parameter sensitivity, and economic and environmental effects. Our findings included (1) the implementation of EPC increased the output of new products and the manufacturer's profits. However, EPC did not effectively stimulate remanufacturing, and could increase carbon emissions; (2) CET could alleviate the adverse effect of EPC on remanufacturing and decrease carbon emissions, but may also decrease the total output; and (3) under certain conditions, CET combined with EPC could reduce carbon emissions while increasing the output of remanufactured products and manufacturer's profits. The conclusions of this paper could help the manufacturer to make rational operational decisions and achieve sustainable production.

Structural equation modeling for three aspects of green business practices: a case study of Bangladeshi RMG's industry

Green business (GB) had often been regarded as a pervasive trend that underlies the operations and performance of businesses. By portrayal of three aspects view of the green business, this paper evaluates green business approaches within the Bangladeshi ready-made garments (RMG) sector and provides a structured framework for the factors affecting the utilization of green business approaches. This study further evaluates how the environmental, societal, and economic impact derived green business practices. The framework is experimentally tested by the partial least square approach to structural equation modeling (PLS-SEM) concentrated on survey responses quantifying the green business practices within 40 RMG organizations situated in Dhaka and Chittagong, Bangladesh. The findings demonstrate that there is a positive relationship between environmental, social, and economic aspects. More specifically, the PLS-SEM estimation demonstrates that the interaction between environmental and economic sustainability has a substantial proportion of values towards profiling GB practice. Meanwhile, there is a vast gap for profiling the performances of environmental and economic aspects through social aspects within the RMG sectors of Bangladesh. Also, there is a significant difference between the predicted and factual green business adoption tendencies and views among different industrial enterprises, especially for waste management and water pollution based on the findings of the SEM-PLS model. Throughout the context of the rapid growth of socioeconomic development and new technological advancement, social level performance possess comparably weak influences of GB strategy on the within Bangladeshi RMG sectors. In the meantime, as the stricter law has a vital impact on the firm's strategies for becoming more environmentally friendly practices, it instituted as an essential variable for quantifying social sustainability. Moreover, the study recommends some suggestions emphasizing the part of the identified model in the context of encouraging business organizations to indulge in environment-oriented socio-economy actions and thus change the emphasis of potential GB study directions.

A Multistage Sustainable Production–Inventory Model with Carbon Emission Reduction and Price-Dependent Demand under Stackelberg Game

This paper investigated a multistage sustainable production–inventory model for deteriorating items (i.e., raw materials and finished goods) with price-dependent demand and collaborative carbon reduction technology investment under carbon tax regulation. The model was developed by first defining the total profit of the supply chain members under carbon tax regulation and, second, considering a manufacturer (leader)–retailer (follower) Stackelberg game. The optimal equilibrium solutions that maximize the manufacturer’s and retailer’s total profits were determined through the method analysis. An algorithm complemented the model to determine the optimal equilibrium solutions, which were then treated with sensitivity analyses for the major parameters. Based on the numerical analysis, (a) carbon tax policies help reduce carbon emissions for both the manufacturer and retailer; (b) most carbon emissions from supply chain operations negatively impact the total profits of both members; (c) the retailer may increase the optimal equilibrium selling price to respond to an increase in carbon emissions from supply chain operations or carbon tax; and (d) autonomous consumption positively affects both members’ optimal equilibrium policies and total profits, whereas induced consumption does the opposite. These findings are very managerial and instructive for companies seeking profits and fulfilling environmental responsibility and governments.

A Study on The Driving Factors and Spatial Spillover of Carbon Emission Intensity in The Yangtze River Economic Belt under Double Control Action

It is greatly important to promote low-carbon green transformations in China, for implementing the emission reduction commitments and global climate governance. However, understanding the spatial spillover effects of carbon emissions will help the government achieve this goal. This paper selects the carbon-emission intensity panel data of 11 provinces in the Yangtze River Economic Belt from 2004 to 2016. Then, this paper uses the Global Moran’s I to explore the spatial distribution characteristics and spatial correlation of carbon emission intensity. Furthermore, this paper constructs a spatial econometric model to empirically test the driving path and spillover effects of relevant factors. The results show that there is a significant positive correlation with the provincial carbon intensity in the Yangtze River Economic Belt, but this trend is weakening. The provinces of Jiangsu, Zhejiang, and Shanghai are High–High agglomerations, while the provinces of Yunnan and Guizhou are Low–Low agglomerations. Economic development, technological innovation, and foreign direct investion (FDI) have positive effects on the reduction of carbon emissions, while industrialization has a negative effect on it. There is also a significant positive spatial spillover effect of the industrialization level and technological innovation level. The spatial spillover effects of FDI and economic development on carbon emission intensity fail to pass a significance test. Therefore, it is necessary to promote cross-regional low-carbon development, accelerate the R&D of energy-saving and emission-reduction technologies, actively enhance the transformation and upgrade industrial structures, and optimize the opening up of the region and the patterns of industrial transfer.

Effects of environmental regulation on the upgrading of Chinese manufacturing industry

In recent years, China has constantly strengthened environmental regulation (ER) to force the manufacturing industry to upgrade. This study theoretically analyzes interaction mechanism of ER on the upgrading of manufacturing industry through foreign direct investment (FDI) and technological innovation (TI) and carries out empirical verification by using provincial panel data from 2000 to 2016 in China. The results demonstrate that the current ER intensity in China is unable to directly promote the upgrading of manufacturing industry, while through the interaction effects of FDI and TI do boost the upgrading of the industry. The above mechanisms are also robust even if we take the regional heterogeneity into consideration. Basic education and urbanization are favorable for the upgrading of the manufacturing industry. However, the increase in dependence on foreign trade is not conducive to upgrading manufacturing industry. Chinese government should further strengthen ER and give full play of the interaction mechanism of ER to guide the flow of foreign investment and force enterprises to carry out TI. In the meanwhile, Chinese government also needs to ensure balanced regional development, thus better promoting the upgrading of manufacturing industry.

Constructing the Embodied Carbon Flows and Emissions Landscape from the Perspective of Supply Chain

From the perspective of supply chain, benchmarking the embodied carbon flows and emissions landscape is to study the carbon footprint in supply chain production and process management. On the basis of the theory of a green supply chain, this paper conducted its research through the following steps. First, a multi-level supply chain model was proposed and established, and various sectors, production and management processes, and inputs and outputs of different resources were integrated into the supply chain network, and then divided into multiple levels. Second, a multi-level embodied carbon flow and emissions model was established through the Leontief Inverse. Third, based on the operation data of forestry-pulp and paper companies, the embodied carbon flows and emissions at all levels and sectors were estimated and analyzed. Finally, the dismantling and processing methods of complex carbon network structures were explored, the hot-spot carbon sources and paths were obtained, and the low-carbon innovation and development strategies were proposed. The research results show that: (1) Supply chain is a new idea and carrier to study the spatial and state changes of carbon, and also provides a platform for spatial landscape analysis of carbon; (2) The modeling and calculation of carbon flows and emissions offer a new solution of evaluating the environmental performance of companies with high pollution and emission such as forestry-pulp and paper companies, and provide the government effective technical support to implement environmental regulations and formulate carbon emission reduction policies.