Abstract: Considering consumers’ overconfidence in product value valuation under carbon trading regulations, the paper studies the emission reduction, order quantity and price decisions of a two-level supply chain composed of a single manufacturer and a single retailer with pre-sale option, and analyzes the influence of retailers’ pre-sale decisions and overconfidence on the game equilibrium, profit, total carbon emissions, consumer surplus and social welfare of supply chain members. The results are as follows. When the wholesale price of new products is very low, retailers should adopt the mode of “normal selling” and offer fresh products at the lowest price. At the same time, the wholesale price, current selling price and social welfare are positively correlated with the overconfidence level of consumers, but the consumer surplus is negatively correlated with the overconfidence level. The order quantity of the current sale period, the emission reduction decision of the manufacturer and the total amount of carbon emissions are not correlated with consumers’ overconfidence. When the new product’s wholesale price is low, the retailer should adopt “discount advance selling + normal selling” mode. At this point, consumers’ overconfidence will help promote carbon emission reduction per unit product, but the impact of overconfidence on supply chain pricing, corporate profits, carbon emissions and social welfare is related to the production cost of products, carbon trading regulation and consumers’ preference for low carbon.

Key words: consumer overconfidence, cap-and-trade, advance sales, emission reduction, supply chain