The government subsidy design considering the reference price effect in a green supply chain.

This paper constructs a green supply chain with a manufacturer and a retailer. Taking into account the reference price effect of consumers based on the mental accounting theory, we investigate the following government incentive policies: R&D (research and development) subsidy, consumption subsidy, and dual subsidy. For manufacturer-led (M-led) and retailer-led (R-led) supply chains, we evaluate the optimal wholesale price, sales price, green degree of product, and the optimal subsidy of the government aiming to improve the environmental benefit or social welfare. We find that the government goal, power structure and reference price effect impact the design of subsidy mechanisms significantly. First, for M-led supply chain, the government concerned with the environmental benefit goal should only provide R&D subsidy for the manufacturer when the reference price effect is low; otherwise, the government would offer subsidy both for the manufacturer and consumers. However, the government will only offer R&D subsidy when the social welfare goal is adopted. Second, for R-led supply chain, the government aiming to improve the environmental benefit prefers dual subsidy when the reference price effect is low; otherwise, consumption subsidy is preferable. Surprisingly, under the social welfare goal, no subsidy for R-led supply chain tends to be the best option. Intriguingly, embracing the social welfare goal can result in more economic and environmental benefits for M-led supply chain, although the subsidy strategy is less effective than the environmental benefit goal. Our research can provide inspirations and references for designing government subsidy mechanisms in practice.

E-commerce platform financing versus trade credit financing: Financing mode selection for online retailer considering live-stream selling in China.

Introduction: The rise of live-stream selling has made the e-commerce platform attractive to many small and medium-sized retailers that are often faced with capital constraints. The choice between the e-commerce platform financing (EPF) and trade credit financing (TCF) for the capital-constrained e-retailers engaging in live-stream selling is particularly important problem. Methods: This paper considers a supply chain made up of a manufacturer, an e-commerce platform that offers live-stream selling service to consumers and an online retailer with capital constraint. We, respectively, investigate the optimal decisions of the supply chain enterprises under EPF and TCF modes based on Stackelberg game models and optimization theories. Results: We compare the profits of supply chain firms under different cases and obtain some important conclusions through theoretical and numerical analysis. Discussion: First, when the e-commerce platform's commission rate is low enough, the retailer's ordering quantity is, under EPF mode, greater than that evidenced without capital constraint. In addition, when the retailer's marginal profit is high and the e-commerce platform's commission rate is low, the online retailer should choose EPF mode; in other instances, TCF is its optimal choice. Second, the e-commerce platform can obtain the highest profit under EPF mode, while TCF mode will bring the highest profit to the manufacturer. Third, when the platform's commission rate is below a certain threshold, the profit of the entire supply chain under EPF mode is larger than that of well-funded supply chain, but TCF mode cannot. Finally, we also find there exists the access threshold about the live-stream selling. Only when the commission rate is relatively high, the e-commerce platform should offers live-stream service to consumers and the live-stream investment is the highest under EPF mode.