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Low-carbon strategies in the alliance between manufacturer and weak customer considering different contracts

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Abstract

With the rise of influential customers and environmental issues, this paper studies the alliance effect of the manufacturer and its weak customers by differential Stackelberg game. Low-carbon production and dynamic pricing strategies are analyzed in alliance and no-alliance situations. The results find that forming an alliance between the manufacturer and its weaker customer helps them resist the advantages of a stronger retailer. Compared to the no-alliance strategy, the alliance strategy will decrease their profits. The stronger customer needs to set a lower retail price toward the alliance between the manufacturer and the weak customer. And it can narrow the price gap in two situations by increasing its proportion of sales revenue. Moreover, when consumers care less about the product's environmental problems, all the partner firms in the supply chain will price lower and make fewer efforts on low-carbon production.

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Funding

This research was funded by the National Natural Science Foundation of China under Grant 72102108 and Grant 61901105; the Youth Fund of the MOE (Ministry of Education in China) Project of Humanities and Social Sciences under Grant 20YJC630245; and the Natural Science Foundation of Jiangsu Province under Grant BK20190343.

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Authors and Affiliations

  1. School of Economics and Management, Nanjing University of Science and Technology, Nanjing, 210094, China

    Yafei Zu & Fengyi Li

  2. School of Information Science and Engineering, Southeast University, Nanjing, 210096, China

    Yinfei Xu

  3. Inspur Academy of Science and Technology, Jinan, 250000, China

    Hui Zhang

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  1. Yafei Zu
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  2. Fengyi Li
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  3. Yinfei Xu
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  4. Hui Zhang
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Correspondence to Yafei Zu.

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Zu, Y., Li, F., Xu, Y. et al. Low-carbon strategies in the alliance between manufacturer and weak customer considering different contracts. Environ Dev Sustain (2023). https://doi.org/10.1007/s10668-023-03371-1

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  • DOI: https://doi.org/10.1007/s10668-023-03371-1

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