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The Impact of AI Adoption on Competition and Social Welfare in Green Supply Chains

In: Proceedings of the 2026 11th International Conference on Financial Innovation and Economic Development (ICFIED 2026)

Author

Listed:
  • Siqi Ye

    (Northwestern University (McCormick Engineering Graduate School))

Abstract

Under the background of current digital and intellectual transformation, artificial intelligence (AI) is profoundly changing the operational and competitive mechanisms of supply chains. This study focuses supply chains involving a single manufacturer and a retailer. The main context explores the impact of AI on green supply chain decision-making strategies and profits distribution. By developing an analytical model, this paper discusses how AI adoption reshapes pricing, green investment and profit distribution between manufacturers and retailers by eliminating the demand forecasting bias (λ). The result has found a ‘dual effect’ of AI; while the overall efficiency of the supply chain leads to opposing changes in profits between two parties. This situation creates an ‘AI paradox’ which means that the actual effect is affected by key parameters such as the initial market forecasting deviation, the intensity of consumers’ green preferences, and the cost of green input. The outcomes reveal that enterprises need to promote AI with collaborative mechanisms to coordinate conflicts of interest and achieve sustainable growth.

Suggested Citation

  • Siqi Ye, 2026. "The Impact of AI Adoption on Competition and Social Welfare in Green Supply Chains," Advances in Economics, Business and Management Research, in: Xiongfeng Pan & Huaping Sun & Abdul Rauf & Md Rabiul Islam & Liew Chee Yoong (ed.), Proceedings of the 2026 11th International Conference on Financial Innovation and Economic Development (ICFIED 2026), pages 818-828, Springer.
    • Handle: RePEc:spr:advbcp:978-94-6239-642-5_84
    DOI: 10.2991/978-94-6239-642-5_84
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