Webinar link

We analyze carbon quota allocation (grandfathering vs. benchmarking) in cap-and-trade systems on supply chain dynamics. Differential game models reveal benchmarking amplifies emission reduction and advertising efforts, accelerating product goodwill growth. Rising permit prices incentivize decarbonization but unevenly affect profits. Per-unit benchmarking fosters collaboration, benefiting all members, whereas grandfathering traps less eco-friendly firms in low-investment cycles.