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Manufacturer encroachment on a green supply chain with environmental labeling

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  • Yufei Hu
  • Lianghua Chen
  • Yingying Chi
  • Yinuo Wang

Abstract

This paper investigates manufacturer encroachment on a green supply chain wherein alternative environmental labels are utilized to disclose the hidden product greenness attribute. We show that both self‐ and government labels facilitate and adjust the promotion effect of encroachment on product greenness, stimulating green demand and retail prices for profitability improvement and raising wholesale prices for investment sharing. The difference is that self‐labeling's low credibility and complete self‐interest features only induce inferior greenness increments and coordination effects. Government labeling outperforms self‐labeling in simultaneously optimizing the interests of the manufacturer, retailer, and society, presuming the benefits of greenness improvement reimburse investments.

Suggested Citation

  • Yufei Hu & Lianghua Chen & Yingying Chi & Yinuo Wang, 2023. "Manufacturer encroachment on a green supply chain with environmental labeling," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(6), pages 3249-3268, September.
    • Handle: RePEc:wly:mgtdec:v:44:y:2023:i:6:p:3249-3268
    DOI: 10.1002/mde.3875
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    References listed on IDEAS

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    Cited by:

    1. Huaqing Qiu & Xuejie Ren & Lindu Zhao, 2024. "Contract manufacturer encroachment via the customer‐to‐manufacturer strategy under different platform selling modes," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 45(4), pages 2591-2612, June.
    2. Zhengzheng Chen & Tiaojun Xiao, 2024. "Green level and environmental labeling strategies in a dual‐channel green supply chain considering consumer trust," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 45(2), pages 637-651, March.
    3. Zhibao Li & Beifen Wang, 2025. "Retailer information sharing under manufacturer encroachment and production cost reduction," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 46(1), pages 602-626, January.

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