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Evolutionary game theoretical approach for reducing carbon emissions in a complex supply chain organization

Zongke Bao (Business School, Hangzhou City University, Hangzhou, China)
Chengfang Wang (School of Accounting, Anhui University of Finance and Economics, Bengbu, China)
Nisreen Innab (Department of Computer Science and Information Systems, Almaarefa University, Riyadh, Saudi Arabia)
Abir Mouldi (Department of Industrial Engineering, King Khalid University, Abha, Saudi Arabia)
Tiziana Ciano (Department of Economics and Political Science, University of Aosta, Aosta, Italy)
Ali Ahmadian (Decisions Lab, Mediterranean University of Reggio Calabria, Reggio Calabria, Italy) (Faculty of Engineering and Natural Sciences, Istanbul Okan University, Istanbul, Turkey)

Management Decision

ISSN: 0025-1747

Article publication date: 3 October 2024

134

Abstract

Purpose

Our research explores the intricate behavior of low-carbon supply chain organizations in an ever-evolving landscape, emphasizing the profound implications of government-mandated low-carbon policies and the growing low-carbon market. Central to our exploration is applying a combined game theory model, merging Evolutionary Game Theory (EGT) with the Shapley Value Cooperative Game Theory Approach (SVCGTA).

Design/methodology/approach

We establish a two-tier supply chain featuring retailers and manufacturers within this novel framework. We leverage an integrated approach, combining strategic Evolutionary Game Theory and Cooperative Game Theory, to conduct an in-depth analysis of four distinct low-carbon strategy combinations for retailers and manufacturers.

Findings

The implications of our findings transcend theoretical boundaries and resonate with a trinity of economic, environmental and societal interests. Our research goes beyond theoretical constructs to consider real-world impacts, including the influence of changes in government low-carbon policies, the dynamics of consumer sensitivities and the strategic calibration of retailer carbon financing incentives and subsidies on the identified ESS. Notably, our work highlights that governments can effectively incentivize organizations to reduce carbon emissions by adopting a more flexible approach, such as regulating carbon prices, rather than imposing rigid carbon caps.

Originality/value

Our comprehensive analysis reveals the emergence of an Evolutionary Stability Strategy (ESS) that evolves in sync with the phases of low-carbon technology development. During the initial stages, our research suggests that manufacturers or retailers adopt low-carbon behavior as the optimal approach.

Keywords

Acknowledgements

Zongke Bao acknowledges the support provided by the Science Technology Department of Zhejiang Province Project (No: 2022C35043), the Hangzhou Dual Carbon Research Center at HZCU, the ESG and Sustainable Development Research Center at HZCU and Eduvirtua (www.eduvirtua.online). The authors extend their appreciation to the Deanship of Research and Graduate Studies at King Khalid University for funding this work through Large Research Project (No: RGP2/210/45).

Citation

Bao, Z., Wang, C., Innab, N., Mouldi, A., Ciano, T. and Ahmadian, A. (2024), "Evolutionary game theoretical approach for reducing carbon emissions in a complex supply chain organization", Management Decision, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/MD-10-2023-1962

Publisher

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Emerald Publishing Limited

Copyright © 2024, Emerald Publishing Limited

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