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Firms’ green R&D cooperation behaviour in a supply chain: Technological spillover, power and coordination

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  • Chen, Xu
  • Wang, Xiaojun
  • Zhou, Mingmei

Abstract

In response to the global fight against climate change, a growing number of firms cooperate with their supply chain partners on green innovations. This study explores firms' green R&D cooperation behaviour in a two-echelon supply chain in which a manufacturer and a retailer first cooperate to invest green R&D and then organise production according to a wholesale price contract. Through a comparison with non-cooperation models, we evaluate the effects of green R&D cooperation on the economic, environmental and social performances of the supply chain while simultaneously considering the technological spillover and supply chain power relationship. Our findings show that the R&D cooperation's improvement of firms' economic performance is mainly determined by firms' own green contribution level. This level is dependent on firms' green R&D investment efficiency and spillover as well as on their relevant power relationship with their supply chain partners. Interestingly, there is a Pareto improvement region in which the green R&D cooperation has a positive impact on firms, customers and the environment. In the case of a non-Pareto improvement region, supply chain coordination can be achieved through a two-part tariff contract. This applies to all three of the supply chain power structures investigated in this research.

Suggested Citation

  • Chen, Xu & Wang, Xiaojun & Zhou, Mingmei, 2019. "Firms’ green R&D cooperation behaviour in a supply chain: Technological spillover, power and coordination," International Journal of Production Economics, Elsevier, vol. 218(C), pages 118-134.
    • Handle: RePEc:eee:proeco:v:218:y:2019:i:c:p:118-134
    DOI: 10.1016/j.ijpe.2019.04.033
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