Green Investment Decisions in Supply Chains: A Game Model with Complete Information

Abstract

Prior literature on a two-level supply chain has mainly focused on the game between one manufacturer and one supplier. Exploring group game behavior in a green supply chain (GSC), our research develops and studies a sequential GSC game model consisting of a single manufacturer and three suppliers based on the characteristics of the textile and apparel industry clusters. In our GSC model, the manufacturer is the leader of the supply chain and the suppliers are either homogeneous or complementary. Through equilibrium analysis, we identify critical conditions that influence the behavior of the manufacturer and suppliers to improve the green investment in the supply chain. Our study provides a theoretical basis and a decision-making reference for promoting the cooperation in GSCs and improving the performance of the government’s environmental policies.

Keywords

• equilibrium analysis
• game
• green supply chain
• group game behavior
• textile and apparel industry