Multi-layer platform supply chain network equilibrium considering service level and quality control under the cap-and-trade regulation

• Published in: Environment, development and sustainability Vol. 27; no. 1; pp. 1421 - 1466
• Main Authors: Shi, Cong, Zhang, Guitao, Zhang, Xiao, Zhou, Yunxu
• Format: Journal Article
• Language: English
• Published: Dordrecht Springer Netherlands 01.01.2025; Springer Nature B.V
• Subjects: Algorithms; Carbon; Consumers; COVID-19; COVID-19 infection; Earth and Environmental Science; Ecology; economic demand; Economic Geology; Economic Growth; Economics; Emissions; Emissions control; Emissions trading; Environment; Environmental Economics; Environmental Management; environmental markets; Environmental objective; Government; Inspections; landscapes; Multilayers; Pattern analysis; Product quality; Quality control; Quality standards; Recycling; Regulation; Remanufacturing; Resource efficiency; Resource utilization; Supervision; Supply; supply chain; Supply chains; Sustainable Development; Platform supply chain network; Service level; Cap-and-trade regulation; Product quality supervision and control; Consumers’ dual preferences
• ISSN: 1573-2975; 1387-585X; 1573-2975
• DOI: 10.1007/s10668-023-03918-2

In the aftermath of COVID-19, meeting the new economic demand while achieving carbon emission reduction goals is a primary challenge facing the global supply chain. To tackle this challenge, we consider the government’s dual-regulatory policies of cap-and-trade (CAT) regulation and product quality supervision and propose a multi-layer platform supply chain network (PSCN) to examine optimal service levels, products quality, and abatement decisions to be made by supply chain members. By leveraging this network, we aim to find effective solutions to tackle the obstacles posed by the new economic landscape and reduce carbon emissions. The suppliers and manufacturers are subject to the CAT regulation, while manufacturers also have the responsibility for the recycling and remanufacturing process. Moreover, the government and platform will conduct quality inspections to ensure the sustainability of PSCN and maintain product quality standards. To obtain the solutions, the altered projection algorithm is employed, and five numerical examples are studied to find that carbon reduction technology shows special value in promoting carbon reduction and stabilizing the development of enterprises and supply chains. An efficient remanufacturing capability allows economic and environmental objectives to be aligned. Additionally, under the platform economy, consumers’ dual preferences and proper service level provide new momentum for development and carbon emission reduction of PSCN. Interestingly, leaders’ insistence on producing high-quality products under low supervision efforts may ultimately reduce PSCN's profit. Some significant management insights for reducing carbon emissions and improving resource utilization efficiency in PSCN under the new development pattern are derived from the analysis.