Abstract: In the context of low-carbonization supply chain, an option contract coordination problem of two-stage supply chain composed of one manufacturer and one retailer is investigated based on the “cap-and-trade” mode. The wholesale price mechanism is viewed as a benchmark. The option contract model is constructed by using the cooperative game method. By analysis, we get the parameters to implement the option contract and the profit distribution plan according to supply chain members' risk preferences and negotiating power. Results show that, compared with the benchmark, the option contract can coordinate supply chain efficiently and robustly. Risk preferences of decision makers play an important role in profit allocation.

Key words:  low-carbonization supply chain, carbon trade, cooperative game, option contract, coordination