Incentive coordination for effective sharing of low-carbon technology innovation

Low-carbon technological innovation (LCTI) is essential for achieving energy efficiency, environmental sustainability, and the development of green economy. However, its success relies on effective sharing and collaboration among stakeholders. This study involves a leading and a collaborating enterprise to evaluate the dynamic decision-making process in LCTI sharing under benefit-sharing, cost-sharing, and incentive-coordination game contracts. Subsequently, using optimal control theory, differences in efforts and profits of diverse enterprises are compared and analyzed for each contract. A robust profit-distribution coefficient for achieving optimal contracts is established and numerical illustrations is utilized to validate theoretical outcomes and reinforce the key insights. Higher marginal benefit coefficients enhance investments in low-carbon technologies, whereas higher innovation costs diminish them. Dynamic changes in product's low-carbon degree under the incentive-coordination contract is more sensitive to fluctuations compared to other contract types, highlighting their effectiveness in managing risks and enhancing utility outcomes. Although the incentive-coordination contract consistently yields higher profits, adjusting the profit-distribution ratio improves the collaborating enterprise's understanding of the value and risks associated with LCTI. These insights not only contribute to designing equitable and effective LCTI sharing contracts, but also reduce uncertainty related to unobserved factors, ensuring a comprehensive range of game outcomes.