Optimal Product Line Design Strategy for Green and Non-Green Products with Blockchain Technology

In practice, manufacturers have three typical product line design strategies to produce green products, i.e., only producing green products ( OG strategy), producing both green and non-green products ( GN strategy) and only producing non-green products ( ON strategy). Moreover, the implementation of blockchain technology is beneficial for consumers to verify the authenticity of product information, then increasing the possibility of consumers making informed purchasing decisions. In view of these backgrounds, an interesting question arises regarding the impact of blockchain technology adoption on the manufacturer’s strategy for product line design. To investigate this issue, we consider a manufacturer facing three product line design strategies under traditional information disclosure and blockchain-driven information disclosure scenarios. By comparing the manufacturer’s optimal decisions in two different scenarios, we find that (i) regardless of the implementation of blockchain technology, as the production cost difference between green and non-green products increases, the manufacturer’s optimal product line decision is from OG strategy to GN strategy and then to ON strategy; (ii) after adopting blockchain technology, it will be more profitable for the manufacturer to choose OG strategy and less profitable to choose ON strategy; and for GN strategy, the profitability depends on the quality difference and the operation cost of blockchain technology; and (iii) a high cost of operating blockchain leads to a reduction in total market demand, which in turn mitigates the negative environmental impact.