Research on the complexity of green innovative enterprise in dynamic game model and governmental policy making

Abstract

Nowadays, with more and more people choosing energy-saving product, green supply chain is increasingly becoming popular. In this paper, we build a dynamic Stackelberg game model that contains government, two green innovation enterprise which is a leader and produces two kinds of green product with similar function but different quality and a retailer selling two kinds of green product meanwhile. We use classical backward induction to solve the model. Price decision is considered first and is divided into two stages. We analyze the equilibrium price of green innovation enterprise and retailer and the stable region. Next, we analyze energy-saving index of two kinds of green product. Through numerical simulation, we further analyze system's stability conditions and system's dynamic evolution process when different parameter is adopted. In the end, we consider green products’ baseline energy-saving index made by government and get the optimal baseline energy-saving index by numerical simulation. We find that too stringent subsidy standards may can't induce manufacturer to invest greener technology. Besides, we use the delay feedback control to effectively control the chaotic phenomenon.