Pricing and quality investments in a mixed brown-green product market

Sustainable Supply Chain Management (SSCM) has assumed a position of prominence for academics and industry over the last two decades. The sustainability literature shows that typically manufacturers aim to optimize their pricing and greening level decisions in a mixed (green and brown) consumer market. In this work, we capture a manufacturer’s classic dilemma on the pricing of green and brown products, and greening investments, while subject to budget constraint. We compute and analyze the variations of optimal decisions over time. Our findings underscore the importance of investing in greening technologies and learning for the survival of green products. Furthermore, we show that a manufacturer’s optimal pricing strategy is to enter the market with a lower price for the green product and to increase it over time, eventually, surpassing the price for the brown product. Our analysis reveals that the greening level attraction can nullify the effect of a high price on the green product, resulting in higher green demand than brown. Higher green product demand is a win-win situation for both the manufacturer and the environment

Environmental Tax in a Green Market

Ecological awareness, Emission tax, Environmental quality, Green market, Vertical differentiation, D62, H21, L13, Q58,

Cross sector land use modelling framework

The purpose of the model component in SENSOR is to quantify the effects of a comprehensive set of policies on land use. The need to include interaction between sectors as well as a high level of detail for each sector calls for a combination of sector specific and sector wide models. This chapter describes the modelling system, with emphasis on the linking of the models to a coherent system. Five sectors of significant importance for land use are modelled individually: Forestry, agriculture, urban land use, transport infrastructure and tourism. All models are connected as sub-modules to an economy-wide partial econometric model. In addition, a land cover model is used to disaggregate land use down to 1 km grid resolution. The linking of such a diverse set of models in a consistent way poses conceptual as well as practical issues. The conceptual issues concern questions such as which items of the models to link, how to obtain a stable joint baseline scenario, and how to obtain a joint equilibrium solution for all models simultaneously in simulation. Practical issues concern the actual implementation of the conceptually sound linkages and provision of a workable technical solution. In SENSOR, great care has been taken to develop a sound linkage concept. The linked system allows the user to introduce a shock in either of the models, and the set of results will provide a joint solution for all sectors modelled in SENSOR. In this manner, the models take a complex policy scenario as argument and compute a comprehensive set of variables involving all five sectors on regional level, which in turn forms a basis for distilling out the impact on sustainability in the form of indicators. Without the extensive automation and technical linkages, it would not have been possible to obtain a joint equilibrium, or it would have required exorbitant amounts of working time