A Game Model for the Pricing of the Government's Subsidy in the Green Supply Chain for Home Appliances Industry in China

Today green supply chain management (GSCM) has received increasing emphasis, as a kind of modern management mode which takes environmental impact and resource efficiency into a comprehensive consideration within the entire supply chain. In this paper, the government’s subsidy in the green supply chain for home appliances industry is studied by constructing a three-player game model among governments, home appliances enterprises and consumers. Through studying the relationships and game status and analyzing the equilibrium of the game model, the paper points out the necessity of creating a government’s subsidy, and proposes the principles of the subsidy as well as provides a numerical example. The research results indicate that the governments can improve the enthusiasm and likelihood of enterprises and consumers to participate in this model of green supply chain management by creating appropriate subsidy to the enterprises, to the consumers and by imposing penalties to those enterprises that do not participate in the green supply chain management. This will promote the implementation of the green supply chain management for the home appliance industry effectively.