Carbon Emission Modeling in Green Supply Chain Management, Two Research Questions Were Presented in Chapter 1
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CARBON EMISSION MODELING IN GREEN SUPPLY CHAIN MANAGEMENT A dissertation submitted to: Kent State University Graduate School of Management In partial fulfillment of the requirements for the degree of Doctor of Philosophy By Zhi Tao April, 2013 II Dissertation written by Zhi Tao B.S., Henan University, 1995 B.S., East China University of Science and Technology, 2001 M.A., University of Delaware, 2005 Ph.D., Kent State University, 2013 Approved by: __________________________________ Co-Chair, Doctoral Dissertation Committee Dr. O. Felix Offodile __________________________________ Co-Chair, Doctoral Dissertation Committee Dr. Alfred Guiffrida __________________________________ Member, Doctoral Dissertation Committee Dr. Tuo Wang Accepted by: _________________________________ Doctoral Director, Graduate School of Management Dr. Murali Shanker __________________________________ Dean, Graduate School of Management Dr. Deborah Spake II Acknowledgement I would like to express my sincere gratitude to the co-chairs of my dissertation, Dr. O. Felix Offodile and Dr. Alfred Guiffrida. I am grateful to them for their guidance, encouragement and support throughout my studies, especially for the amount of time they devoted to ensure that the dissertation was completed on time. I also appreciate the freedom they gave me to develop my ideas; and their timely feedbacks and edit that helped to significantly improve the dissertation. They are great professors, advisers, and role models in my career. I am also thankful to Dr. Tuo Wang for his unceasing support. Together they form a helpful committee for my research. Dr. Jay Muthuswamy, Dr. Frederick Schroath and Dr. O. Felix Offodile believed in my abilities and offered me the opportunity to pursue my Ph.D. in operations management. For that I am especially indebted to them. I am also thankful to Dr. Guido Geerts who kindled the flicker of academia and Ph.D. in me when I was pursuing my master’s program at the University of Delaware. During my years at Kent State University I was fortunate to have been exposed to Dr. Murali Shanker, Dr. Eddy Patuwo, Dr. Alan Smith, Dr. David Booth, Dr. Marvin Trout, Dr. Eric Johnson, Dr. Emmanuel Dechenaux, Dr. George Stevens and other faculty who helped me develop my research skills. I cherish my friendship with Dr. Thomas Ngniatedema, Dr. Veronica Thomas, Dr. Yaman Roumani, Dr. Joseph Nwankpa, Dr. Kuntal Bhattacharyya, and Dr. Lihua Chen who, being ahead of me in the program, allowed me to learn from their experiences. Also, my current peers in the program Fengkun Liu, Matthew Geiszler, Jay Brown, Fanglin Shen, Logan Browning, Maxim Bushuev and Janet Bartholow have been inspiration to me as we learned from each other. Outside the business school, I thank Miss Kjera Melton and Dr. Jeffrey Pellegrino for being there whenever I needed help. III I was fortunate to meet Dr. Joseph Sarkis at a conference and appreciate his allowing me to draw from his insights and experience on green supply chain management over the years. Finally, I would be remiss if I did not express my sincere gratitude to my dear husband, Shufang Dong, and my lovely son, Todd Dong. I am blessed that Shufang is considerate, caring and patient with me while I worked on my dissertation. He believes in me, listens to me, cheers me up and supports me all the time, especially during the low times. I also thank him for his insights on the mathematical models in the dissertation. Todd’s progress in all perspectives and positive attitude inspire me every day. Without them, this dissertation would not have been possible. I also thank my parents in China for their unconditional love. Their love, vision, and encouragement make all my dreams come true. This dissertation is dedicated to my husband, my son and my parents. IV Table of Contents Acknowledgement .................................................................................................................... II List of Tables ........................................................................................................................... IX Abstract ..................................................................................................................................... X Chapter 1 .................................................................................................................................... 1 Introduction ................................................................................................................................ 1 1.1 Background ................................................................................................................. 1 1.2 Carbon Emission Reduction: Carbon Tax and Carbon Cap-and-Trade ...................... 4 1.3 The Importance of Modeling Carbon Emission Cost.................................................. 9 1.4 Research Objectives .................................................................................................. 11 Chapter 2 .................................................................................................................................. 15 Literature Review..................................................................................................................... 15 2.1 The Traditional Lot Size Models .............................................................................. 15 2.2 Carbon Measurement Models ................................................................................... 17 2.3 Lot Size Models with Carbon Emission .................................................................... 18 2.4 Summary ................................................................................................................... 20 Chapter 3 .................................................................................................................................. 23 Modeling the Carbon Emission Conscious Retailer ................................................................ 23 3.1 Notation ..................................................................................................................... 24 3.2 Input-Output for the Retailer ..................................................................................... 25 3.3 Model Development .................................................................................................. 27 3.3.1 The Economic Order Quantity (EOQ) Model ................................................... 28 3.3.2 The Carbon Emission Order Quantity (CEOQ) Model ..................................... 29 3.3.3 The Carbon Tax Order Quantity (CTOQ) Model .............................................. 30 3.3.4 The Comprehensive Cost under Carbon Tax Mechanism ................................. 30 3.3.4.1 The Comprehensive Order Quantity (COQ) Model ....................................... 31 3.3.4.2 The Impact of Carbon Tax Mechanism.......................................................... 32 V 3.3.4.3 Numerical Examples ...................................................................................... 35 3.3.5 The Comprehensive Cost under Cap-and-Trade Mechanism ............................ 37 3.3.5.1 The Carbon Order Cap-and-Trade Quantity (COCTQ) Model ...................... 37 3.3.5.2 The Comprehensive Order Quantity (COQ) Model ....................................... 38 3.3.5.3 Impact of Cap-and-Trade Mechanism............................................................ 39 3.3.5.4 Numerical Examples ...................................................................................... 44 3.4 Conclusions ............................................................................................................... 48 Chapter 4 .................................................................................................................................. 50 Modeling the Carbon Emission Conscious Manufacturer ....................................................... 50 4.1 Notation ..................................................................................................................... 51 4.2 Input-Output for the Manufacturer ............................................................................ 52 4.3 Model Development .................................................................................................. 52 4.3.1 The Economic Production Quantity (EPQ) Model ............................................ 54 4.3.2 The Carbon Emission Production (CEPQ) Model............................................. 55 4.3.3 The Carbon Production Tax (CPTQ) Model ..................................................... 56 4.3.4 The Comprehensive Cost under Carbon Tax Mechanism ................................. 56 4.3.4.1 The Comprehensive Production Quantity (CPQ) Model ............................... 57 4.3.4.2 The Impact of Carbon Tax Mechanism.......................................................... 57 4.3.4.3 Numerical Examples ...................................................................................... 61 4.3.5 The Comprehensive Cost under the Cap-and-Trade Mechanism ...................... 62 4.3.5.1 The Carbon Emission Cap-and-Trade Quantity (CECTQ) Model................. 63 4.3.5.2 The Comprehensive Production Quantity (CPQ) Model ............................... 64 4.3.5.3 The Impact of Carbon Cap-and-Trade Mechanism........................................ 65 4.3.5.4 Numerical Examples ...................................................................................... 69 4.4 Conclusions ..............................................................................................................