Abstract: A two-level green supply chain system which consists of one leader manufacturer and one follower retailer is considered. The market demand of green products mainly is impacted by the price and the product green degree level. Assuming that consumer's preference for green products is asymmetric information,the manufacturer cannot accurately predict consumer's green preference. Based on above analysis, game models are built under three different situations and the optimal solution is obtained for the wholesale price, product greenness, retailing price, manufacturer and retailer's profit under three different conditions. The different changes of the optimal solution are compared and analyzed under three different situations and the different impact of consumers' green preference on the optimal decision and profit analyzed. The result shows that (1) the government subsidy mechanism can not only greatly improve the green degree of products, but also increase the manufacturer and retailers' profit; (2) regardless of consumers' green preference, government subsidies for unit products are negatively correlated with the wholesale price of green products while positively correlated with the greenness level of green products; (3) when consumers' preference for green products is low, the profit of manufacturers in RG decision model is higher than that in MG decision model.

Key words: asymmetric information, green supply chain, green preference, subsidy mechanism, green degree level