Decision and Coordination in a Competitive Green Supply Chain with Diverse R&D Leadership

Against the growing global focus on green development, government subsidies are widely recognized as a crucial policy tool to promote firms’ green transformation. In competitive markets, green investment decisions are jointly shaped by supply chain power structures, and different research and development (R&D) leadership can yield distinct policy outcomes. This study develops a Bertrand competition model of a green supply chain with one manufacturer and two competing retailers, comparing two structures: manufacturer-led R&D (SM) and retailer-led R&D (SR). We examine how these policies affect pricing decisions, product greenness, and revenues. Under the retailer-led R&D, a green cost-sharing ratio is introduced to capture the interaction between internal coordination and government support. The results show that subsidy effects depend on consumer green awareness. When green awareness is low, subsidies mainly raise prices through cost pass-through. When green awareness is high, subsidies can lower prices by stimulating demand. In addition, the interaction between subsidy intensity and cost sharing leads to non-monotonic changes in retailers’ revenues. By comparing different market structures and parameter settings, we identify the conditions under which SM or SR dominates in terms of prices, product greenness, and revenues, providing guidance for more flexible green subsidy design.