Coordinating a sustainable innovation supply chain with cooperative investment contract under Stackelberg game

Sustainable innovation is important at all stages of the supply chain development. Each stage of the supply chain, they need to invest on sustainable innovation research and development. Motivated by the real business investigation, a supply chain model with one supplier and one manufacturer is analysed in this study. We consider a cooperative investment contract for the supplier and the manufacturer with sustainable innovation development. We derive the optimal results in both without(with) cooperative investment contract. The results indicate that an optimal cooperative rate can perfectly coordinate the supply chain with sustainable innovation development.