Blockchain Traceability Strategy for Retailers Oriented to Government Subsidy

Retailers implement traceability strategies to guarantee product quality and safety, strengthen consumer trust, and improve market competitiveness. However, the additional cost burden diminishes retailers' motivation to implement blockchain traceability strategies. The government aims to jointly promote the development of traceability strategy in the retail industry and provides financial support to alleviate the cost burden of retailers. Therefore, we examine the blockchain traceability strategy of competing retailers under government subsidies via constructing supply chain system models. We then also analyze the impacts of competition effects, cost effects, and government subsidies on competitive retailers' traceability strategy choices. The results show that operational costs and competitive effects limit retailers' implementation of blockchain traceability strategies, while government subsidies mitigate the negative impacts of cost effects and competitive effects. However, investment costs undermine the positive effects of government subsidies. Moreover, the retailers achieve an asymmetric equilibrium when the cost effect, competitive effect, and market expansion advantage match each other. Besides, when both retailers implement the blockchain traceability strategy, they may suffer from the prisoner's dilemma. Inspiringly, government subsidies narrow the probability of retailers suffer from a prisoner's dilemma through offsetting the cost disadvantage. Furthermore, the government subsidy provides a significant contribution to enhancing social welfare and promoting retailers to implement traceability strategies.