Research On Coordination Of The Green Supply Chain Based On Contract Theory

With the rapid development of economy, people are facing the greatpressure of environmental disruption and resources shortage, then gradually realizedthe importance of environmental protection and sustainable development. Lots ofenterprises put the activity of environmental improvement into their strategic plan anddaily operation, and more and more scholars also concern to the research of GreenSupply Chain. However, because of the diversity of operation target of Green SupplyChain unavoidable makes the members of chains face contradictory conflict whenthey cooperate, how to realize the perfect coordination of Green Supply Chainbecomes one of the key problems of the research.This paper takes the Green Supply Chain which consists of one manufacture,retailer and collector for the research object, and researches the coordinating problemof Green Supply Chain which bases on the Contract Theory.Firstly, from the cooperate target and management mode, chapter one analysisthe importance of coordination of Green Supply Chain and the elements which affectthe coordination of Green Supply Chain; then based on the research of the methodsand theories which improve and promote coordination, chapter three puts forwardContract Theory and Game Theory to realizing coordination of Green Supply Chain.Based above mentioned thoughts, this paper builds the modes of Green SupplyChain which consists of manufacture, retailer, consumer and collector in decentralizeddecision and centralized decision. Through researching, we found that the mode incentralized decision existed optimal decision and obtained the total optimal profit ofthe Supply Chain; however, in decentralized decision, due to the Game Relationshipbetween individuals, the mode did not have the optimal decision, that is the totalprofit of system could not reach the optimal condition.To make up the losses of the total profit of system in the decentralized decision,though introducing Revenue-sharing contract between members and adjusting recovering price and effort levels of recovering, we build the mode of coordination ofthe Green Supply Chain based on Contract Theory. In this mode, the profit ofmanufacture, retailer, collector and the system had been improved; the total profit ofthe system in decentralized decision reached the lever in centralized decision; thisrealized the coordination of the Green Supply Chain effectively. In the last, this paperverified the effectiveness and correctness of this mode in form of numericalverification.