Differential Game Study of Supply Chain under Carbon Tax Policy

Under the carbon tax policy, assuming that consumer demand is jointly influenced by upstream and downstream enterprises’ carbon emission reduction and low-carbon promotion efforts, two Stackelberg differential game models are constructed for the long-term joint emission reduction and low-carbon promotion of manufacturers and retailers before and after cost sharing, taking into account the dynamic changes of product carbon emission reduction influenced by upstream manufacturers’ emission reduction efforts. The results show that, compared with no carbon tax, the implementation of the carbon tax policy can improve the carbon emission reduction of products and retailers’ profits in the long run, but will reduce manufacturers’ profits; in addition, when the carbon tax and the marginal profits of upstream and downstream enterprises meet certain conditions, the cost-sharing contract can further improve the carbon emission reduction of products, realize the Pareto improvement of profits of upstream and downstream enterprises, and broaden the elasticity space of the carbon tax.