EURO 2024 Copenhagen
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1601. Carbon Reduction, Blockchain Technology, and Business Model in Online Retail Platforms

Invited abstract in session WC-23: New technology for sustainable supply chains, stream Circular Economy, Remanufacturing and Recycling .

Wednesday, 12:30-14:00
Room: 82 (building: 116)

Authors (first author is the speaker)

1. Qi Sun
School of Economics and Management, China University of Petroleum (East China)
2. Yumin Fu
Harbin Engineering University
3. Cheng Ma
Qingdao University

Abstract

Online platforms are leveraging its power to foster environmentally friendly supply chains. This study explores the blockchain application and business model decisions in a supply chain with a manufacturer selling through an online retail platform. The manufacturer decides whether to adopt blockchain technology to provide evidence of carbon reduction, aiming to secure an eco-friendly label from a platform, which in turn determines the business model, choosing between agency selling and reselling. We fully characterize the equilibrium decisions and show how they depend on the carbon reduction efficiency, blockchain efficiency, and commission rate. The presence of a carbon reduction manufacturer reduces the effectiveness of using the wholesale price as a lever by itself. Therefore, employing blockchain upon a reselling platform can hurt the manufacturer. We also show that blockchain technology and business mode are complementary, and therefore managers should not ignore the impact of one decision on the other decision even when the latter is not a primary motivation of the former. This study represents a significant stride towards the integration of blockchain in production and underscores collaboration with dominant platforms to offer guidelines for effectively reducing carbon emissions.

Keywords

Status: accepted

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