A Study on Dual-Channel Green Supply Chain Decision Making Considering Free-riding Behavior under Government Subsidies

Amidst the context of government subsidies provided to manufacturers, this paper explores the influence of consumer free-riding behavior in the market on the pricing strategies of dual-channel green supply chains. By conducting comparative analyses, the study discloses the effects of consumer free-riding presence or absence on pricing strategies and profit margins within dual-channel green supply chains. This analysis demonstrates how consumer free-riding behavior, whether present or absent, influences supply chain decision-making processes and profitability. The study’s findings indicate that, firstly, the profits of manufacturers tend to follow an inverted U-shaped curve rather than showing continuous growth with increasing consumer free-riding coefficients. This suggests that beyond a certain threshold of consumer free-riding, there is a potential decline in manufacturers' profits. Secondly, consumer free-riding behavior does not always favor manufacturers; in some instances, it may actually be detrimental to their interests. Lastly, the phenomenon of consumer "free-riding" could negatively impact environmental conservation by diminishing manufacturers' incentives for green production and lowering retailers' commitment to promotional activities. These insights are critical for comprehending the influence of consumer behavior on supply chain decisions and for formulating effective supply chain management tactics.