Operation decision of competitive mining supply chain based on social responsibility

Abstract

The development of the green economy has significantly impact the traditional mining industry. Mining enterprises must invest in green technology to reduce the environmental pollution caused by flying dust and soil erosion and are subject to increased scrutiny to be socially responsible when conducting their business. To address this issue, we consider a competitive mining supply chain system consisting of two excavators and two exclusive retailers. Among them, the excavators have a certain sense of corporate social responsibility (CSR), that is, in addition to pursuing economic profits, they also consciously pay attention to the interests of consumers. We establish three different game models that two excavators exhibit no CSR behaviour (NN), two excavators exhibit CSR behaviour (SS) and one excavator exhibits CSR behaviour (SN). We examine the optimal decision-making strategies and analyse the impact of social responsibility. Analytical results show that the optimal strategies of mining supply chain are different under different supply chain structures. The optimal decisions of the mining supply chain members are the same in each case under the NN and SS models. In the SN model, the optimal decision strategy value of mining supply chain members is always greater than non-socially responsible supply chain members. In SS model, when the intensity of social responsibility competition is low, two excavators reduce the wholesale price, and retailers reduce the sales price; when the intensity of social responsibility competition is strong, two excavators will increase the wholesale price, and retailers will increase the sales price. These help to promote product sales and increase the profits of the supply chain system. In SN model, with the increase of social responsibility competition intensity, the wholesale price of two excavators and the sales price of retailers first increased and then decreased. Finally, numerical examples illustrated to justify the proposed model.