The Optimal Emission Reduction and Recycling Strategies in Construction Material Supply Chain under Carbon Cap–Trade Mechanism

Abstract

As urbanization continues to expand in China, carbon emissions (CE) from the construction industry and the amount of construction and demolition waste (C&DW) are rapidly increasing. In order to reduce CEs and environmental hazards, this paper constructs a Stackelberg game model to explore the evolution of carbon emissions reduction (CER) and recycling strategies in the construction material supply chain (CMSC) under the carbon cap–trade (C&T) mechanism. The monotonicity analysis on important variables and model comparison simulation are then conducted. The results show the following: (1) A contractor’s green preference positively correlates with the CER level and recycling rate, while the CER cost exerts the opposite effect. (2) The C&T mechanism incentivizes low-emission manufacturers to actively participate in CER. However, excessive carbon trading prices may put high-emitters in a dilemma, making the whole supply chain profitless. (3) The recycler’s decision to recycle C&DW tends to follow the manufacturer’s CER decision. These findings not only help policy makers understand stakeholders’ behavior in CMSC under C&T mechanism, but also provide a basis for the government to formulate CER policies and introduce low-carbon management.