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Effects of a dominant retailer on green supply chain activities with government cooperation

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Abstract

This paper considers a two-echelon green supply chain (SC) with one manufacturer that sells a same product to two retailers. There is also an environment-conscious government (Govt.) who intends to cooperate with the manufacturer and increase the level of the greenness of the products. We introduce a novel concept in the green literature which is to consider a dominant retailer in the green market. Then, we develop four scenarios for different power structures among the retailers and also for Govt. cooperation with the manufacturer and we obtain closed form solutions for the decision variables of the members based on game theory. By conducting a sensitivity analysis, the effects of power imbalance of the retailers in the market on the environmental protection activities of the manufacturer, pricing policies and profits of the members are illustrated. We also analyze how cooperation with a dominant retailer affects the manufacturer’s profit. In addition, whether dominancy in the market is an advantage for the retailers is also studied by analyzing their profit. Finally, the effects of the different goal seeking behaviors of the Govt. are analyzed on its cooperation with the manufacturer and social welfare under different scenarios. The results of this research provide interesting insights for the manufacturers and retailers in decision making with environmental protection goals under different power perspectives and also for the cooperation of the Govt. with the manufacturers under different real-world scenarios.

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Authors and Affiliations

  1. School of Industrial Engineering, Iran University of Science and Technology, Tehran, Iran

    Fatemeh Zand & Saeed Yaghoubi

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  1. Fatemeh Zand
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  2. Saeed Yaghoubi
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Correspondence to Saeed Yaghoubi.

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Zand, F., Yaghoubi, S. Effects of a dominant retailer on green supply chain activities with government cooperation. Environ Dev Sustain 24, 1313–1334 (2022). https://doi.org/10.1007/s10668-021-01498-7

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  • DOI: https://doi.org/10.1007/s10668-021-01498-7

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