Impact of manufacturers’ eco-design decisions on the closed-loop supply chain under recycling rate regulations
Wenxia Liu, Jiang Jiang, Zhixin Mao, Honglei Liu
TL;DR
This paper studies how government recycling regulations influence manufacturers' eco-design choices and supply chain outcomes.
Contribution
A novel game-theoretic model is proposed to analyze eco-design decisions under recycling rate regulations.
Findings
Eco-design adoption by manufacturers leads to lower product prices, higher sales, and increased profits.
Higher recycling targets reduce eco-design efforts and raise product prices, suggesting a gradual policy approach.
Reward-penalty mechanisms can effectively encourage eco-design and influence product pricing strategies.
Abstract
To address increasingly severe environmental issues, various countries have introduced relevant environmental protection regulations. This paper proposes a new government regulation measure to encourage manufacturers to improve recycling rates. Governments set recycling rate targets and reward-penalty mechanisms. This paper constructs a game model involving a manufacturer and a remanufacturer within a closed-loop supply chain system. It studies the equilibrium decisions in three scenarios: no government intervention, manufacturers not taking improvement measures despite government-set recycling rate targets, and manufacturers adopting ecological design after such targets are established. Results indicate that after governments establish recycling rate target: (1) After manufacturers adopt ecological design, the prices of new and remanufactured products decrease, sales volume increases,…
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Taxonomy
TopicsSustainable Supply Chain Management · Recycling and Waste Management Techniques · Environmental Sustainability in Business