Work

Supply chain decision making under government subsidies: Considering CSR and consumer fairness concerns

Year: 2026

Type: article

Abstract: In this paper, we proposed two three-stage game theoretic models consisting of a government-manufacturer-retailer: Government subsidizes to the retailer (RS-strategy) and government subsidizes to the manufacturer (MS-strategy). We found that consumers' fairness concerns always perform a detrimental influence on supply chain members' CSR efforts and overall social welfare. Government subsidies can improve the adverse effects of consumer fairness concerns, supply chain members' performance and social welfare effects. In addition, we conducted a comparative study between no-government subsidies and two subsidy models in the numerical analysis section. Both subsidy strategies achieved Pareto improvement for supply chain members (manufacturer and retailer) compared with the no-subsidy decentralized scenario. The RS-strategy had higher expected returns but also higher risks regarding consumers' fairness concerns. The MS-strategy could optimize the risk of consumers' fairness concerns and address lower subsidy costs. Managerial implications provide insights into the decision-making of supply chain members and the choice of government strategies.

Source: Journal of Industrial and Management Optimization

DOI: 10.3934/jimo.2026149

Authors: Xiaogang Cao, Zhaoyu Xu, Kewei Li, Hui Wen

Institutions: Wuhan Textile University, Jiangxi Academy of Sciences, Hubei University of Technology

Language: English

Topic: Supply Chain and Inventory Management

Subfield: Management Science and Operations Research

Field: Decision Sciences

Domain: Social Sciences

SDG: Responsible consumption and production

Open Access status: diamond

OpenAlex ID: W7202364330