Abstract Consider a supply chain with one supplier and one manufacturer. The government imposes carbon tax for firms’ carbon emission. The carbon footprint affects product demand. In this context, the paper analyzes the emission reduction decisions of the supplier and the manufacturer, discusses the jointly emission reduction between them with transfer payment contract. Also, the paper explores the impact of some parameters on firms’ emission reduction decisions and profits. The results show: (1) By improving its emission reduction level or providing transfer payment for the supplier, the manufacturer can encourage the supplier to improve its emission reduction level. (2) Jointly emission reduction is effective for optimizing the production carbon footprint and the Pareto improvement of the supply chain profit. (3) The transfer payment factor has nothing to do with the firms’ emission reduction cost factors. (4) The firms’ emission reduction levels increase with carbon tax rate, while the emission reduction increments resulted from jointly emission reduction decrease.
JIA Liang-Jie,HAO Wang-Jiang,TUN Meng-Jiao. Supply Chain Optimization of Emission Reduction Based on Transfer Payment under Carbon Tax System. Economic Survey, 2015, 31(4): 0114.
2015, Vol. 31 
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