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Blockchain Technology and Manufacturing Industry: Real-Time Transparency and Cost Savings

Author

Listed:
  • Taehyun Ko

    (College of Economics, Sungkyunkwan University, Jongno-gu, Seoul 03063, Korea)

  • Jaeram Lee

    (College of Business, Gachon University, Seongnam-si, Gyeonggi-do 13120, Korea)

  • Doojin Ryu

    (College of Economics, Sungkyunkwan University, Jongno-gu, Seoul 03063, Korea)

Abstract

Blockchain technology has been recommended for the sustainability in the manufacturing industry, owing to its benefits in terms of real-time transparency and cost savings. To verify this, we first examine how firms can employ distributed ledger technology by adopting blockchain technology to achieve real-time transparency and cost savings. We also review the current blockchain technology applications in the financial industry and supply chains to explain this technology’s mechanisms for enabling real-time transparency and cost savings in the manufacturing industry. Finally, we theoretically compare the profits of manufacturing firms in two managerial delegation games under a duopoly situation. This theoretical model suggests that the real-time transparency and cost savings secured by blockchain technology improve the profitability and competitiveness of manufacturing firms, which, in turn, assure the sustainability in the manufacturing industry.

Suggested Citation

  • Taehyun Ko & Jaeram Lee & Doojin Ryu, 2018. "Blockchain Technology and Manufacturing Industry: Real-Time Transparency and Cost Savings," Sustainability, MDPI, vol. 10(11), pages 1-20, November.
    • Handle: RePEc:gam:jsusta:v:10:y:2018:i:11:p:4274-:d:183818
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    References listed on IDEAS

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