Operational Decision and Sustainability of Green Agricultural Supply Chain with Consumer-Oriented Altruism

Abstract

The agricultural supply chain has to balance the economic, environmental, and social dimensions of sustainability. This paper investigates the green agricultural supply chain, consisting of a manufacturer and a retailer, who are both altruistic towards consumers. Such consumer-oriented altruism is different from the widely adopted enterprise-oriented altruism, which only measures the altruistic behaviors among supply chain enterprises. In the approach of game theory, the optimal operational decision is obtained, and thereby the economic, environmental, and social dimensions of sustainability are described rationally and attained, respectively. The impacts of consumer-oriented altruism on the sustainability of the green agricultural supply chain are analyzed and compared in a systematic way. A case study is carried out before drawing conclusions and managerial implications. The findings can be concluded as follows. Firstly, consumer-oriented altruism changes the operational performance of the green agricultural supply chain by enhancing the green level of agricultural products, cutting down the pricing decisions and marginal profit of each supply chain enterprise. Secondly, consumer-oriented altruism simultaneously facilitates each dimension of sustainability to different extents, and economic sustainability is promoted the most prominently, whereas environmental sustainability is improved the least. Thirdly, the retailer’s consumer-oriented altruism always improves each dimension of sustainability more than the manufacturer’s altruism does, and the advantage in the economic dimension is the most significant, while that in the environmental dimension is the smallest.