Selection of Reselling and Agency Mode : Impacts of Blockchain Technology

In recent years, blockchain technology has been increasingly applied to the luxury supply chain traceability. It enables companies and consumers to track the product information and carbon footprint in the whole chain, which alleviating consumers' distrust of luxury goods. In the e-commerce market, many online retailers act as resellers or agents when selling products. Will the introduction of blockchain technology affect the selection of channel mode? In this paper, to investigate the supply chain partners’ channel mode selection towards the adoption of blockchain technology, we consider a luxury supply chain comprising a risk-averse luxury manufacturer and an online retailer. We find that the adoption of blockchain will result in a lower price in agency mode. Besides, the manufacturer and the online retailer have opposite preferences for channel mode selection on commission rate without blockchain. But when blockchain is adopted, they are both better off in agency mode in more cases. Considering the significant carbon emissions in luxury industry, we further investigate the impact of blockchain on environmental externalities. We find that the adoption of blockchain will reduce the environmental performance