The price-dependent newsvendor models with carbon constraints

In this paper, we incorporate carbon emission constraints into the price‐dependent newsvendor models. In the two settings with carbon emission tax and cap‐and‐trade mechanism, respectively, we determine the newsvendor's optimal order quantity and the optimal selling price simultaneously. We consider two different ways in which price affects the demand distribution, namely price only affects the location or scale of the demand distribution. The impact of carbon emission tax, carbon price and carbon emission quota on price and inventory decisions, carbon emission and profit are examined. Finally, a numerical example is presented to verify the analysis.