Who Has More Incentive to Make Sustainable Investment, Supplier or Manufacturer?

Core manufacturers often require their suppliers to get involved in sustainable projects by making investment. Meanwhile, the manufacturers themselves also make sustainable investment. In this paper, we investigate the incentive and impact of the sustainable investment made by the supplier and manufacturer, respectively. Analytical results show that it is more beneficial for the environment when the supplier makes sustainable investment. In addition, the supplier has incentive to invest with profit improvement rather than the manufacturer's obligatory requirement.