Low-carbon Operations Management And Inducement Policy Design Considering Consumer Preference

Nowadays,air pollution has become a hot issue which impress us deeply from the serious fog and haze shrouding in China.Prompted by haze crises,the willingness and enthusiasm of the public and government for curbing pollution has never been so strong.Carbon dioxide as a representative of greenhouse gas is the research object of this paper.Everyone takes low-carbon responsibility in its own way.Governments design and carry out the related low-carbon policy,while firms adopt low-carbon technology and investment.At the same time,the environmental awareness among citizens has a sharp increase which could help to build an environmental philosophy.This paper focuses on the rising environmental awareness throughout this paper.The impact of environmental awareness on production optimization,the supply chain operations and government environment policy design are widely studied in this paper.Low-carbon preference of consumer is reflected by the higher price willing to pay for low-carbon product.Based on the convenient access to product's environment information,more and more people pay attention to the product environmental performance and have a preference to the low-carbon one.The market demand will be deeply impacted by this phenomenon which makes low-carbon operations to be an important decision besides the firms' traditional operations decisions.We firstly study the firm's production optimization in cap-and-trade system.We rebuilt the model with depicting consumer low-carbon preference and product's carbon footprint.Through the analysis we get the optimal low-carbon choice for this firm in cap-and-trade system:either all emissions with low-carbon processing or no processing.The result shows that the raise of consumer low-carbon preference would be more profitable for firm's low-carbon operations,which promoting the firm potentially choosing low-carbon processing even in the cost disadvantage case.In a supply chain,the whole environment performance of product is the combined output with all involved the supply chain members and operation processes.As a result,low-carbon operations should also be extended to supply chain level.Considering consumer low-carbon preference,we take low-carbon investments as a supplementary into traditional supply chain operational decisions.We develop a Stackelberg-like model to game-theoretically analyze the supply chain decisions of one manufacturer and one retailer.The prerequisite of both-sides voluntary low-carbon effort is obtained and analyzed.The supply chain centralized decision-making system is investigated as a benchmark to evaluate the supply chain performance.Additionally,a carbon-related price-discount-sharing-like(PDS-like)scheme is proposed to achieve the channel coordination and we discuss the possibility of Pareto improvement in this situation.Based on the related literatures and low-carbon laws and regulations currently in effect,we rethink the detailed emission cap allocation mechanism in cap-and-trade system.With the definition and description of the balance of governments between the economy and the environment,we design a unit-product emission cap allocation mechanism which takes the industry average low carbon effort as a reference,enlightened by the cap allocation regulation of Beijing currently in effect.Through game-theoretically analysis,a simple but executable emission cap policy is obtained.Besides,we also introduce low-carbon preference into this design system.After strict calculation and derivation,we find that the framework of government cap allocation mechanism stays the same while the firm's low-carbon investment would be promoted by this preference.More low-carbon investment,better low-carbon performance which means the emission cap for each product allocated by the government will be actually decrease.These results indicate that consumer environment awareness could accelerate the low carbon process which enlightens our government to pay more attention to consumer low-carbon preference and revise the related technical parameters with accurate forecasting.