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<p>The growing public environmental awareness and green demands are prompting the government and manufacturers to emphasize green manufacturing and operations. Due to the growth of e-commerce, manufacturers are increasingly entering the retail market to sell products directly to consumers. The green supply chain in this paper is integrated with manufacturer encroachment strategies and government subsidy policies. We consider two manufacturer encroachment strategies (i.e., centralized and decentralized encroachments) and two government subsidy policies (i.e., green degree subsidy and R&amp;D cost subsidy). In these settings, we construct four Stackelberg game models and derive the optimal solutions. First, the positive effects of government subsidies and consumer green awareness on green production are demonstrated. Notably, increasing product substitutability harms the manufacturer but favors product greenness and the retailer’s profitability. Second, under each government subsidy policy, decentralized encroachment outperforms centralized encroachment in improving product greenness and each party’s profits. Third, the ratio of environmental performance and purchasing price is examined. We conclude that consumers stand to gain from the enhanced subsidy coefficient, and that heightened consumer green awareness is positively correlated with this benefit. We also find that, under a fixed government subsidy on expenditure, when consumers have sufficiently high green awareness, the R&amp;D cost subsidy policy makes products greener. Nevertheless, the green degree subsidy policy benefits each member of the supply chain. Finally, the robustness of our qualitative findings is verified by numerical modeling and analysis, and some essential managerial countermeasures are also proposed.</p>

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Government subsidy and manufacturer encroachment in the presence of consumer green awareness

  • 期刊论文

  • 发表日期：

    2026年7月25日

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  • Jin Li,
  • Tiantian Tan,
  • Ying Fei,
  • Zhuo Gong

摘要

The growing public environmental awareness and green demands are prompting the government and manufacturers to emphasize green manufacturing and operations. Due to the growth of e-commerce, manufacturers are increasingly entering the retail market to sell products directly to consumers. The green supply chain in this paper is integrated with manufacturer encroachment strategies and government subsidy policies. We consider two manufacturer encroachment strategies (i.e., centralized and decentralized encroachments) and two government subsidy policies (i.e., green degree subsidy and R&D cost subsidy). In these settings, we construct four Stackelberg game models and derive the optimal solutions. First, the positive effects of government subsidies and consumer green awareness on green production are demonstrated. Notably, increasing product substitutability harms the manufacturer but favors product greenness and the retailer’s profitability. Second, under each government subsidy policy, decentralized encroachment outperforms centralized encroachment in improving product greenness and each party’s profits. Third, the ratio of environmental performance and purchasing price is examined. We conclude that consumers stand to gain from the enhanced subsidy coefficient, and that heightened consumer green awareness is positively correlated with this benefit. We also find that, under a fixed government subsidy on expenditure, when consumers have sufficiently high green awareness, the R&D cost subsidy policy makes products greener. Nevertheless, the green degree subsidy policy benefits each member of the supply chain. Finally, the robustness of our qualitative findings is verified by numerical modeling and analysis, and some essential managerial countermeasures are also proposed.