Carbon emission reduction and profit distribution mechanism of construction supply chain with fairness concern and cap-and-trade

Autoři: Wen Jiang aff001;  Li Yuan aff001;  Lanjun Wu aff001;  Shiyue Guo aff002
Působiště autorů: College of Architecture and Urban-Rural Planning, Sichuan Agricultural University, Chengdu, P.R. China aff001;  Southwest Oil & Gas field Company, Petro China, Chengdu, P.R. China aff002
Vyšlo v časopise: PLoS ONE 14(10)
Kategorie: Research Article
doi: 10.1371/journal.pone.0224153


Fairness concern behavior is extremely common in social life, and many scholars are beginning to pay attention to this behavior. In this study, we investigate a two-echelon construction supply chain that consists of a general contractor and a subcontractor under cap-and-trade policy. We study the carbon emission reduction decisions and profit distribution mechanism in the construction supply chain with fairness concern and cap-and-trade. We use the Nash bargaining model to describe the fairness concerns of the construction supply chain members and use the co-opetition model to portray the profit distribution. We show that the fairness concern can impose an adverse influence on firms’ profits and decrease the magnitude of their carbon emission reductions. The subcontractor’s fairness concern causes greater losses to the construction supply chain’s profit. We further demonstrate the impact of fairness concern on the optimal decisions of the general contractor and the subcontractor through numerical analysis.

Klíčová slova:

Decision making – Economics – Global warming – Numerical analysis – Pollution – Science policy – Structure of markets – Supply chain management


1. Liu B, Holmbom M, Segerstedt A, Chen W. Effects of carbon emission regulations on remanufacturing decisions with limited information of demand distribution. International Journal of Production Research. 2015; 53(2):532–548.

2. Morrissey J, Horne RE. Life cycle cost implications of energy efficiency measures in new residential buildings. Energy and Buildings. 2011; 43(4):915–924.

3. International Energy Agency releases global carbon dioxide emissions report(2018) [Internet].

4. How much has China’s carbon emissions increased in 2018? [Internet].

5. Briscoe G, Dainty A. Construction supply chain integration: an elusive goal? Supply Chain Management: An International Journal, 2005, 10(4):319–326.

6. Vrijhoef R, Koskela L. The four roles of supply chain management in construction. European Journal of Purchasing & Supply Management. 2000; 6(3):169–178.

7. Ofori G. Greening the construction supply chain in Singapore. European Journal of Purchasing & Supply Management. 2000; 6(3):195–206.

8. Jiang W, Yuan L, Wu LJ, Zhou Y. Pricing and carbon emission strategy of supply chain with cap and trade. IOP Conference Series: Materials Science and Engineering. IOP Publishing, 2018; 439(3):032046.

9. Xu X, He P, Xu H, Zhang Q. Supply chain coordination with green technology under cap-and-trade regulation. International Journal of Production Economics. 2017; 183:433–442.

10. Leung DYC, Yung D, Ng A, Leung MKH, Chan A. An overview of emissions trading and its prospects in Hong Kong. Environmental Science & Policy. 2009; 12(1):92–101.

11. Fehr E, Schmidt KM. A theory of fairness, competition, and cooperation. The Quarterly Journal of Economics. 1999; 114(3):817–868.

12. Liu W, Wang S, Zhu D, Wang D, Shen X. Order allocation of logistics service supply chain with fairness concern and demand updating: model analysis and empirical examination. Annals of Operations Research. 2018; 268(1):177–213.

13. Du S, Wei L, Zhu Y, Nie T. Peer-regarding fairness in supply chain. International Journal of Production Research. 2018; 56(10):3384–3396.

14. Pu X, Gong L, Han G. A feasible incentive contract between a manufacturer and his fairness-sensitive retailer engaged in strategic marketing efforts. Journal of Intelligent Manufacturing. 2019; 30(1):193–206.

15. Rabin M. Incorporating Fairness into Game Theory and Economics. The American Economic Review. 1993; 83(5):1281–1302.

16. Scheer LK, Kumar N, Steenkamp J-BEM. Reactions to perceived inequity in U.S. and dutch interorganizational relationships. Academy of Management Journal. 2003; 46(3):303–316.

17. Forsythe R, Horowitz JL, Savin NE, Sefton M. Fairness in Simple Bargaining Experiments. Games and Economic Behavior. 1994; 6(3):347–369.

18. Nie T, Du S. Dual-fairness supply chain with quantity discount contracts. European Journal of Operational Research. 2017; 258(2):491–500.

19. Wang Y, Chen W, Liu B. Manufacturing/remanufacturing decisions for a capital-constrained manufacturer considering carbon emission cap and trade. Journal of Cleaner Production. 2017; 140:1118–1128.

20. Yang L, Ji J, Wang M, Wang Z. The manufacturer’s joint decisions of channel selections and carbon emission reductions under the cap-and-trade regulation. Journal of Cleaner Production. 2018; 193:506–523.

21. Hugo A, Pistikopoulos EN. Environmentally conscious long-range planning and design of supply chain networks. Journal of Cleaner Production. 2005; 13(15):1471–1491.

22. The Carbon Trust. Carbon footprints in the supply chain: the next step for business [Internet]. 2006.

23. Du SF, Zhu LL, Liang L, Ma F. Emission-dependent supply chain and environment-policy-making in the ‘cap-and-trade’ system. Energy Policy, 2013, 57: 61–67.

24. Xu X, He P, Xu H, Zhang Q. Supply chain coordination with green technology under cap-and-trade regulation. International Journal of Production Economics. 2017; 183:433–442.

25. Xia L, Guo T, Qin J, Yue X, Zhu N. Carbon emission reduction and pricing policies of a supply chain considering reciprocal preferences in cap-and-trade system. Annals of Operations Research. 2018; 268(1):149–175.

26. Wang X, Xue M, Xing L. Analysis of carbon emission reduction in a dual-channel supply chain with cap-and-trade regulation and low-carbon preference. Sustainability. 2018; 10(3):580.

27. Luo Z, Chen X, Wang X. The role of co-opetition in low carbon manufacturing. European Journal of Operational Research, 2016, 253(2): 392–403.

28. Niu B, Mu Z, Chen L, et al. Coordinate the economic and environmental sustainability via procurement outsourcing in a co-opetitive supply chain[J]. Resources, Conservation and Recycling, 2019, 146: 17–27.

29. Jiang W, Wu L, Zhou Y. Pricing and Carbon Reduction Mode for Prefabricated Building Supply Chain with Cap and Trade. International Conference on Management Science and Engineering Management. Springer, Cham, 2018: 1417–1427.

30. Jiang W, Lu WF, Xu QW. Profit distribution model for construction supply chain with cap-and-trade policy. Sustainability. 2019; 11(4):1215.

31. Ho TH, Su X, Wu Y. Distributional and peer-induced fairness in supply chain contract design. Production and Operations Management. 2014; 23(2):161–175.

32. Zhou Y, Bao M, Chen X, Xu X. Co-op advertising and emission reduction cost sharing contracts and coordination in low-carbon supply chain based on fairness concerns. Journal of Cleaner Production. 2016; 133:402–413.

33. Jiang H, Shao X, Zhang X, Bao J. A study of the allocation of carbon emission permits among the provinces of china based on fairness and efficiency. Sustainability. 2017; 9(11):2122.

34. Zhang T, Wang X. The impact of fairness concern on the three-party supply chain coordination. Industrial Marketing Management. 2018; 73:99–115.

35. Chang J, Hu Z. Venture capital contracting with double-sided moral hazard and fairness concerns [Internet]. Mathematical Problems in Engineering. 2018.

36. Li Q, Xiao T, Qiu Y. Price and carbon emission reduction decisions and revenue-sharing contract considering fairness concerns. Journal of Cleaner Production. 2018; 190:303–314.

37. Kadefors A. Client-contractor relations: How fairness considerations and interests influence contractor variation negotiations. Proceedings IGLC-7, 1999:231–240.

38. Meng Q, Chen J, Qian K. The complexity and simulation of revenue sharing negotiation based on construction stakeholders [Internet]. Complexity.2018

39. Xiaowei A, Huimin L, Ojuri O, Zhuofu W, Jiyong D. Negotiation model of design optimization profit distribution with fairness concerns in construction projects. KSCE Journal of Civil Engineering. 2018; 22(7):2178–2187.

40. Jiang W, Yuan L. Profit distribution model of green building supply chain with fairness preferences and cap-and-trade policy. IOP Conference Series: Earth and Environmental Science. 2019; 237: 052043.

41. Du S, Nie T, Chu C, Yu Y. Newsvendor model for a dyadic supply chain with Nash bargaining fairness concerns. International Journal of Production Research. 2014; 52(17):5070–5085.

42. Nash JF Jr. The Bargaining Problem. Econometrica. 1950; 18:155–162.

43. De Bruyn A, Bolton G E. Estimating the influence of fairness on bargaining behavior. Management science. 2008; 54(10):1774–1791.

44. Li J, Lu J, Wang Q, Li C. Quality and pricing decisions in a two-echelon supply chain with Nash bargaining fairness concerns. discrete dynamics in nature and society [Internet]. 2018;

45. Shi Q, Zhu J, Li Q. Cooperative evolutionary game and applications in construction supplier tendency [Internet]. Complexity. 2018.

46. Zeng W, Wang H, Li H, Zhou H, Wu P, Le Y. Incentive mechanisms for supplier development in mega construction projects. IEEE Transactions on Engineering Management. 2019; 66(2):252–265.

47. Amirreza M, Mehdi MM. Financial-based incentive plan to reduce construction waste. Journal of Construction Engineering and Management. 2018; 144(5):04018029.

48. Berends TC. Cost plus incentive fee contracting—experiences and structuring. International Journal of Project Management. 2000; 18(3):165–171.

49. Bubshait AA. Incentive/disincentive contracts and its effects on industrial projects. International Journal of Project Management. 2003; 21(1):63–70.

50. Shr JF, Chen WT. Setting maximum incentive for incentive/disincentive contracts for highway projects. Journal of Construction Engineering and Management. 2004; 130(1):84–93.

51. Fan K, Chan EHW, Qian QK. Transaction costs (TCs) in green building (GB) incentive schemes: Gross Floor Area (GFA) Concession Scheme in Hong Kong. Energy Policy. 2018; 119:563–573.

52. Chan APC, Chan WM, Fan CN, Lam PTI, Yeung JFY. Achieving partnering success through an incentive agreement: lessons learned from an underground railway extension project in Hong Kong. Journal of Management in Engineering. 2008; 24(3):128–137.

53. Yi J, Chen HX, Li S. Determination of contract time and incentive and disincentive values of highway construction projects. International Journal of Construction Education and Research. 2010; 6(4):285–302.

54. Meng X, Gallagher B. The impact of incentive mechanisms on project performance. International Journal of Project Management. 2012; 30(3):352–362.

55. Hosseinian SM, Carmichael DG. Optimal incentive contract with risk-neutral contractor. Journal of Construction Engineering and Management. 2013; 139(8):899–909.

56. Kerkhove LP, Vanhoucke M. A parallel multi-objective scatter search for optimising incentive contract design in projects. European Journal of Operational Research. 2017; 261(3):1066–1084.

57. Shi Q, Zhu J, Hertogh M, Sheng Z. Incentive mechanism of prefabrication in mega projects with reputational concerns. Sustainability. 2018; 10(4):1260.

58. Groenenberg H, Blok K. Benchmark-based emission allocation in a cap-and-trade system. Climate Policy. 2002; 2(1):105–109.

59. Chen X, Wang X, Chan HK. Manufacturer and retailer coordination for environmental and economic competitiveness: A power perspective. Transportation Research Part E: Logistics and Transportation Review. 2017; 97:268–281.

60. Chen X, Luo Z, Wang X. Impact of efficiency, investment, and competition on low carbon manufacturing. Journal of Cleaner Production. 2017; 143:388–400.

61. Zhang L, Zhou H, Liu Y, Lu R. Optimal environmental quality and price with consumer environmental awareness and retailer’s fairness concerns in supply chain. Journal of Cleaner Production. 2019; 213:1063–1079.

Článek vyšel v časopise


2019 Číslo 10