Research on the Tripartite Evolutionary Game of Zero-Waste City Construction in China

Abstract

The aim in mind in the construction of a zero-waste city is to recycle municipal solid waste in a more reasonable way in order to achieve the sustainable development of the urban environment. This goal is widely used internationally as a green development concept in urban management. However, when only the government takes the lead in the construction process, neglecting to engage and guide the participation of the public and of enterprises, the realization of a zero-waste city becomes challenging. Therefore, effective collaboration among all stakeholders would be a more effective approach to dealing with solid waste and creating an eco-friendly and livable urban environment. In this study, we adopted an evolutionary game model and selected three typical stakeholders—the government, the public, and enterprises—in order to examine the choice of tripartite strategies and their primary influencing factors based on prospect theory. This study found the following: (1) the selection of tripartite strategies at different stages of a zero-waste city’s construction is influenced by the expected benefits and costs; (2) the government’s leading role and related subsidies can promote the enthusiasm of enterprises and the public to participate in the construction of a zero-waste city; (3) tripartite participation in a zero-waste city’s construction can maximize benefits, and after a sustainable development model has been established, each stakeholder can choose to participate actively, even without government intervention; and (4) the construction of a zero-waste city requires long-term exploration and practice, and China is currently in a transition period from government-led to government-directed planning. Establishing a perfect reward and punishment mechanism is beneficial in promoting the active participation of the public and of enterprises. The authors of this paper studied the game process of stakeholders at each stage of a zero-waste city’s construction through prospect theory and explored the influences of important parameters on the strategic choice of each subject at the current stage by conducting numerical simulations, which has implications for the construction and sustainable development of a zero-waste city.

1. Introduction

According to the IPCC definition, municipal solid waste includes various categories, including waste from food, gardens and parks, paper and cardboard, wood, textiles, rubber and leather, plastics, metal, glass, and other items such as ash, dirt, dust, soil, and electronics. The world produces approximately 2.01 billion tons of municipal solid waste each year. It is projected that this number will increase to 3.4 billion tons by 2050. A significant portion of this solid waste flows into rivers, with the Asia-Pacific region accounting for 23% of global solid waste generation [1]. Failure to effectively manage and treat this waste will result in a range of ecological and environmental issues, such as river blockages and water pollution [2]. A country’s desire for economic development often conflicts with the limits of the ecological environment. The faster a region experiences economic growth, and the larger its economic volume, the higher its per capita resource consumption and solid waste emissions become. Cities benefit from economic growth but also suffer from environmental pollution. Despite government policies aimed at solid waste recycling, there is still a significant gap between recycling targets and actual recycling rates [3,4].

In 1973, Yale University’s Paul Palmer introduced the zero-waste concept. The goal was to address the problem of recycling electronic and chemical materials in California. After decades of development, the zero-waste concept has been widely adopted by governments and included in relevant bills [5]. In 1996, the government of Canberra, the capital of Australia, was the first to propose a construction goal for a zero-waste city, committing to urban waste management and recycling. Since then, the governments of the United States and Canada have also adopted the concept of zero-waste cities, the realization of which involves establishing a closed-loop energy system and developing a circular economy [6]. The core of a zero-waste city is to convert solid waste into a resource while reducing municipal solid waste generation. In a sustainable city concept, waste can be transformed into an urban energy source through a recycling mechanism. This involves reducing waste generation while also creating value for the waste that is generated [7]. The construction of a waste-free city not only limits the landfilling and incineration of solid waste, improving the ecological environment [8], but also promotes the effective use of solid waste and the development of a circular economy. Zero-waste cities are important for achieving carbon peaking and carbon neutrality [9].

As China’s urban industrialization continues and its population size increases, the significant growth of solid waste is seriously affecting the urban environment [10]. Currently, China’s urbanization rate has exceeded 60%, resulting in the production of more than 200 million tons of urban waste per year, which will cause a serious loss of resources if this waste continues to be landfilled. Moreover, some chemical and medical solid waste with dangerous properties may cause serious environmental pollution and harm public health [11]. On the one hand, the total output of municipal solid waste is large, and there are many problems with its recycling and utilization. The degree of solid waste resource utilization is not high, and there is still a large gap in the public demand for environmental solutions. On the other hand, the current relevant policies are mostly government-led, with little participation from environmental stakeholders and an imperfect solid waste governance structure. The solution to these problems is not only to reduce the generation of solid waste but also to effectively recycle solid waste resources through the cooperation of multiple parties [12]. Since 2017, the Chinese government has introduced a series of measures to promote the maximization of resource utilization and the minimization of environmental pollution based on the policy of solid waste reduction, waste classification, and recycling. The government also proposed and carried out the pilot construction of a zero-waste city in 2019. However, due to different levels of economic development, environmental resource endowments, and relevant policies and regulations for each city, the effective solid waste utilization models and the cooperative bodies also differ greatly. Thus, a complete and mature management mechanism has not been formed yet.

During the construction of a zero-waste city, it is inevitable to realize it through the cooperation of multiple social entities [13,14]. Although city governments are the main service providers of municipal solid waste management, increasing solid waste and management costs have imposed a large burden on the related financial budgets. The current stage of construction has resulted in a government-led phenomenon, but the construction of a zero-waste city based on long-term sustainable development cannot rely on the government alone. Instead, the government also needs to actively guide the joint participation of other environmental stakeholders in order to achieve a zero-waste city through the power of all social actors [15]. In this regard, we propose a tripartite framework, with the government, enterprises, and the public acting as the three parties. We describe the game mechanism under different strategies for the three parties, in which the government’s strategy is active and negative guidance, and enterprises and the public are active and negative participants. We use an evolutionary game model to analyze the evolutionary equilibrium in order to study the influence of multi-subject cooperation on the construction of a zero-waste city and provide relevant suggestions.

2. Literature Review

At present, academic research on zero-waste cities focuses on construction models and policy recommendations. Zhao et al. [16] suggested reducing solid waste landfills and using innovative technologies to replace traditional disposal methods. Lee et al. [17] argued for increasing energy recovery opportunities through waste prevention and separation. Zaman et al. [18] quantified zero-waste city management performance through the waste conversion rate and the zero-waste index and elaborated on the construction of zero-waste cities through waste management and urban metabolism. Gu et al. [19] elaborated on the importance of solid waste recycling and disposal from the perspective of a circular economy compared with the waste recycling potential of cities at different income levels in China and proposed solid waste recycling strategies based on the economy and population. Zaman et al. [20] argued for legislation to reduce solid waste incineration and landfills in order to promote recycling and waste resource utilization. Fujita et al. [21] argued that the construction of a zero-waste city requires active government guidance and broad public support. Meng et al. [22] analyzed the current situation of zero-waste city development in China and suggested changing the development model, with the government and the market jointly leading solid waste collection, recycling, and disposal. Zhang et al. [5] argued that the government can change its role from a leading one to multi-subject cooperation, guiding enterprises and social organizations through the formulation of incentive policies. Zaman et al. [23] emphasized the importance of policy laws and individual behavior and noted that lifestyle and values have a significant impact on building a zero-waste city.

In analyzing multi-subject cooperation, the evolutionary game model can help us explore the evolutionary paths of finite rational subjects under different strategies. Li et al. [24] simulated the construction strategy of a zero-waste city by constructing an evolutionary game model involving the central government and local government, and the results showed that the construction cost of a zero-waste city affected the construction strategies of local governments, leading to proposed promotion measures occurring in phases. Wang et al. [25] constructed an evolutionary game model with the government, enterprises, and the public as the three parties involved in order to analyze the recycling of construction waste based on prospect theory. The results showed that the cooperation of the three parties was conducive to realizing construction waste resource utilization. Tian et al. [26], through an evolutionary game model with society and government as the main bodies, analyzed the evolutionary strategy of public decisions in the case of waste incineration. Gao et al. [27] constructed an evolutionary game model, involving the government and social investors, to analyze new energy power projects and the game results in the case of waste incineration. Zhao et al. [28] constructed an evolutionary game model with the government, disposal enterprises, and medical institutions as the primary players in order to analyze the problem of medical waste resource recovery. The results indicated that the government’s reward and punishment mechanism impacts the three-party cooperation game strategy.

After reviewing the literature, we discovered that most of the research on constructing zero-waste cities is theoretical and focuses on constructing models from index systems for quantitative analysis, rather than considering benefits and costs. The game models for multi-entity cooperation in solid waste disposal primarily focus on strategies between the government, enterprises, and social organizations, and insufficient studies are related to the public as the primary acting entity. This paper introduced prospect theory, and the strategic choices of each game subject were studied at each stage of constructing a zero-waste city. The public plays an essential role in constructing a zero-waste city. Therefore, a tripartite evolutionary game model was constructed with the government, enterprises, and the public as the primary subjects. The model was combined with prospect theory in order to analyze stability and simulate key parameters, providing valuable insights for the development of a zero-waste city at this stage, thus holding some reference value for the development of a zero-waste city.

3. Model Assumptions and Description

3.1. Evolutionary Game Strategy

In the construction of a zero-waste city, each social entity contributes its unique value within its capacity and has an interactive impact. The government, enterprises, and the public are the primary actors in constructing a zero-waste city. They all share the benefits of a healthy ecological environment after completion. For the government, adopting negative measures leads to a loss in credibility and an increase in complaints from the public, while positive policies build up the government’s image and influence in the city. Enterprises and members of the public face coercive measures if they fail to participate in the construction of a zero-waste city, such as being fined by the government for not separating waste. Meanwhile, they receive corresponding incentive subsidies when they participate. Using evolutionary game theory, the evolutionary strategical choices of the three subjects were set as follows.

The government’s strategy is to adopt both positive and negative policies. Under a positive policy, the government creates relevant policy documents and improves laws and regulations through which to actively guide enterprises and the public to participate. The government provides them with incentive subsidies if they take the initiative to carry out waste separation, waste management, and technological innovation. Fines are imposed on them in the absence of participation. Under a negative policy, the government issues no reward or punishment for the cooperation and participation of other subjects.

The public has two strategies: positive and negative participation. The positive participation strategy means that people actively participate in constructing a zero-waste city, consciously practice waste separation, cultivate zero-waste awareness, and supervise the government. The negative participation strategy refers to people’s negative attitude toward the construction of a zero-waste city and means that they take no action toward participating in the zero-waste effort.

Enterprises have two strategies: positive and negative participation. The positive participation strategy means that enterprises strengthen industrial restructuring, reduce the emission of solid waste during production, use government subsidies to innovate technologies with which to use solid waste resources, and, at the same time, strengthen the concept of green culture in enterprises and cultivate zero-waste awareness among employees. The negative participation strategy means that enterprises treat a zero-waste city’s construction passively and take no action toward the effort.

3.2. Model Parameter Assumptions

Based on the above strategies and the actual situation, this study proposed the following assumptions (the parameters were set as shown in

Table 1. Symbols and descriptions.

Parameter	Description
Rp	Expected benefits to the public
Re	Expected benefits to enterprises
Cg	Costs to government
Cp	Costs to the public
Ce	Costs to enterprises
Sp	Government subsidies to the public
Se	Government subsidies to enterprises
Mp	Additional government expenditure when the public participates negatively
Me	Additional government expenditure when enterprises participate negatively
Ng	Loss to government when a zero-waste city is not built
Np	Loss to public when a zero-waste city is not built
Rt	Initial gains for enterprises
K	Complaints from the public under negative government policies
Qp	Government fines for negative public participation
Qe	Government fines for negative enterprise participation
I	City influence
Rg	Expected benefits to government

):

(1)

The government, the public, and the enterprises involved in the construction of a zero-waste city are three limited rational subjects that are affected by factors such as information asymmetry and randomness. They make strategic choices based on the principle of benefit maximization and conduct continuous learning in order to achieve the optimal strategy.

(2)

The probability of the government implementing a positive policy is x, and the probability of it implementing a negative policy is 1 − x, x∈(0,1). In the absence of the construction of a zero-waste city, the government suffers environmental pollution damage, denoted as Ng. In the positive construction of a zero-waste city, the costs and benefits are Cg and Rg, respectively, while the increase in the city’s influence is I. Under a positive policy, the government provides incentive subsidies to the people and firms that choose to participate in the strategy, denoted as Sp and Se, respectively. The fines for the people and enterprises that negatively participate are Qp and Qe. In this case, the government is fully dominant and requires additional construction costs for Mp and Me to build a zero-waste city. Under a negative policy, the government faces complaints from the public, and its credibility K is reduced. In this case, the construction of a zero-waste city can still be achieved if enterprises and the public participate together.

(3)

The probability of public participation with a positive strategy is y, and the probability of participation with a negative strategy is 1 − y, y∈(0,1). The damage from environmental pollution to the public in the absence of a zero-waste city’s construction is Np, and the costs and benefits of positively participating in the construction of a zero-waste city are Cp and Rp.

(4)

The probability of enterprises’ participation in a positive strategy is z, and the probability of their participation in a negative strategy is 1 − z, z∈(0,1). The enterprises’ original benefit is Rt in the absence of a zero-waste city’s construction. The cost of positively participating in building a zero-waste city and the benefits after completion are denoted as Ce and Re.

4. Model Establishment and Solution

4.1. Model Establishment

(1)

The expected returns for the government

When both the public and enterprises choose to actively participate in the construction of a zero-waste city, the expected return for the government when adopting a positive policy is Rg − Cg − Se − Sp + I, and the expected return under a negative policy is Rg − K. When both the public and the enterprises choose to participate negatively, the expected return for the government under a positive policy is Rg − Cg − Mp − Me + Qp + Qe, and the expected return under a negative policy is −Ng.

When the public chooses to participate actively and the enterprises choose to participate negatively, the expected return for the government under a positive policy is Rg − Cg + Qe − Me − Sp, and the expected return under a negative policy is −Ng − K. When the public chooses to participate negatively and enterprises choose to participate actively, the expected return for the government under a positive policy is Rg − Cg + Qp − Mp − Se, and the return under a negative policy is −Ng.

(2)

The expected returns for the public

When the government chooses a positive policy and enterprises choose to actively participate, the expected return for the public choosing active participation is Rp − Cp + Sp, and the expected return for negative participation is Rp − Qp. When the government chooses a positive policy and enterprises choose negative participation, the expected return for the public choosing active participation is Rp − Cp + Sp, and the expected return for negative participation is Rp − Qp.

When the government chooses a negative policy and enterprises choose to actively participate, the expected return for the public choosing to actively participate is Rp − Cp, and the expected return for choosing to negatively participate is −Np. When the government chooses a negative policy and enterprises choose to negatively participate, the expected return for the public choosing to actively participate is −Cp − Np, and the expected return for choosing to negatively participate is −Np.

(3)

The expected returns for enterprises

When the government chooses a positive policy and the public chooses to actively participate, the expected return for enterprises choosing to actively participate is Re − Ce + Se, and the expected return for negative participation is Re − Qe. When the government chooses a positive policy and the public chooses to negatively participate, the expected return for enterprises choosing to actively participate is Re − Ce + Se, and the expected return for choosing to negatively participate is Re − Qe.

When the government chooses a negative policy and the public chooses to actively participate, the expected return for enterprises choosing to actively participate is Re − Ce, and the expected return for choosing to negatively participate is Rt. When the government chooses a negative policy and the public chooses to negatively participate, the expected return for enterprises choosing to actively participate is Rt − Ce, and the expected return for choosing to negatively participate is Rt. The tripartite return matrix is shown in

Table 2. The choices and returns in the tripartite construction of a zero-waste city.

		Enterprises Participate Positively	Enterprises Participate Negatively
Government chooses a positive policy	Public participates positively	Rg − Cg − Se − Sp + I	Rg − Cg + Qe − Me − Sp
		Rp − Cp + Sp	Rp − Cp + Sp
		Re − Ce + Se	Re − Qe
	Public participates negatively	Rg − Cg + Qp − Mp − Se	Rg − Cg − Mp − Me + Qp + Qe
		Rp − Qp	Rp − Qp
		Re − Ce + Se	Re − Qe
Government chooses a negative policy	Public participates positively	Rg − K	−Ng − K
		Rp − Cp	−Cp − Np
		Re − Ce	Rt
	Public participates negatively	−Ng	−Ng
		−Np	−Np
		Rt − Ce	Rt

.

4.2. Replication Dynamic Equation

Assume that V₁₁ and V₁₂ are the expected returns of the government’s choice of positive and negative policies for a zero-waste city’s construction, respectively, and V₁ is the average return. Based on the above return matrix, the government’s replication dynamic equation F(x) is expressed as follows:

V₁₁ = yz(Rg − Cg − Se − Sp + I) + y(1 − z)(Rg − Cg + Qe − Me − Sp) + (1 − y)z(Rg − Cg + Qp − Mp − Se) + (1 − y)(1 − z)(Rg − Cg − Mp − Me + Qp + Qe)
V₁₂ = yz(Rg − K) + y(1 − z)(−Ng − K) + (1 − y)z(−Ng) + (1 − y)(1 − z)(−Ng)
V₁ = x(y(z − 1)(Cg + Me − Qe − Rg + Sp) + z(y − 1)(Cg + Mp − Qp − Rg + Se) − (y − 1)(z − 1)(Cg + Me + Mp − Qe − Qp − Rg) − yz(Cg − I − Rg + Se + Sp)) − (x − 1)(Ngz(y − 1) − Ng(y − 1)(z − 1) + y(z − 1)(K + Ng) − yz(K − Rg))
F(x) = dx/dt = x(x − 1)(Cg + Me + Mp − Ng − Qe − Qp − Rg − Ky − Mpy − Mez + Qpy + Qez + Spy + Sez − Iyz + Ngyz + Rgyz)

(1)

Assume that V₂₁ and V₂₂ are the expected returns to the public for choosing positive and negative participation in a zero-waste city’s construction, respectively, and V₂ is the average return. According to the above return matrix, the replication dynamic equation F(y) of the public is expressed as follows:

V₂₁ = xz(Rp − Cp + Sp) + x(1 − z)(Rp − Cp + Sp) + (1 − x)z(Rp − Cp) + (1 − x)(1 − z)(−Cp − Np)
V₂₂ = xz(Rp − Qp) + x(1 − z)(Rp − Qp) + (1 − x)z(−Np) + (1 − x)(1 − z)(−Np)
V₂ = Npx − Cpy − Np − Qpx + Rpx + Npyz + Qpxy + Spxy + Rpyz − Npxyz − Rpxyz
F(y) = dy/dt = −y(y − 1)(Npz − Cp + Qpx + Spx + Rpz − Npxz − Rpxz)

(2)

Assume that V₃₁ and V₃₂ are the expected returns to enterprises for choosing positive and negative participation in a zero-waste city’s construction, respectively, and V₃ is the average return. Based on the above benefit matrix, the replication dynamic equation F(z) for enterprises is expressed as follows:

V₃₁ = xy(Re − Ce + Se) + x(1 − y)(Re − Ce + Se) + (1 − x)y(Re − Ce) + (1 − x)(1 − y)(Rt − Ce)
V₃₂ = xy(Re − Qe) + x(1 − y)(Re − Qe) + (1 − x)y(Rt) + (1 − x)(1 − y)(Rt)
V₃ = Rt − Cez − Qex + Rex − Rtx + Qexz + Sexz + Reyz − Rtyz − Rexyz + Rtxyz
F(z) = dz/dt = −z(z − 1)(Qex − Ce + Sex + Rey − Rty − Rexy + Rtxy)

(3)

4.3. Jacobi Matrix and Equilibrium Points

It takes some time for the three-party subject game to reach equilibrium so that f(x) = 0, f(y) = 0, and f(z) = 0. According to the actual conditions, 0 and 1 are the only choices for the three parties’ strategies, and at this time, eight equilibrium points can be found at (0,0,0), (0,0,1), (0,1,1), (0,1,0), (1,1,1), (1,0,1), (1,0,1), (1,0,0), and (1,1,0). According to Friedman’s theorem, the Jacobi matrix is stable when all the eigenvalues are negative, and it is an unstable point if at least one positive real value appears [29]. The Jacobi matrices of the three-party game are as follows:

$$\mathrm{J}=\left\{\begin{array}{c}\frac{\mathrm{d}\mathrm{F}\left(\mathrm{x}\right)}{\mathrm{d}\mathrm{x}}\\ \frac{\mathrm{d}\mathrm{F}\left(\mathrm{y}\right)}{\mathrm{d}\mathrm{x}}\\ \frac{\mathrm{d}\mathrm{F}\left(\mathrm{z}\right)}{\mathrm{d}\mathrm{x}}\end{array}\begin{array}{c}\frac{\mathrm{d}\mathrm{F}\left(\mathrm{x}\right)}{\mathrm{d}\mathrm{y}}\\ \frac{\mathrm{d}\mathrm{F}\left(\mathrm{y}\right)}{\mathrm{d}\mathrm{y}}\\ \frac{\mathrm{d}\mathrm{F}\left(\mathrm{z}\right)}{\mathrm{d}\mathrm{y}}\end{array}\begin{array}{c}\frac{\mathrm{d}\mathrm{F}\left(\mathrm{x}\right)}{\mathrm{d}\mathrm{z}}\\ \frac{\mathrm{d}\mathrm{F}\left(\mathrm{y}\right)}{\mathrm{d}\mathrm{z}}\\ \frac{\mathrm{d}\mathrm{F}\left(\mathrm{z}\right)}{\mathrm{d}\mathrm{z}}\end{array}\right\}$$

(4)

Among them,

dF(x)/dx = (x − 1)(Cg + Me + Mp − Ng − Qe − Qp − Rg − Ky − Mpy − Mez + Qpy + Qez + Spy + Sez − Iyz + Ngyz + Rgyz) + x(Cg + Me + Mp − Ng − Qe − Qp − Rg − Ky − Mpy − Mez + Qpy + Qez + Spy + Sez − Iyz + Ngyz + Rgyz)
dF(x)/dy = x(x − 1)(Qp − Mp − K + Sp − Iz + Ngz + Rgz)
dF(x)/dz = x(x − 1)(Qe − Me + Se − Iy + Ngy + Rgy
dF(y)/dx = −y(y − 1)(Qp + Sp − Npz − Rpz)
dF(y)/dy = −(y − 1)(Npz − Cp + Qpx + Spx + Rpz − Npxz − Rpxz) − y(Npz − Cp + Qpx + Spx + Rpz − Npxz − Rpxz)
dF(y)/dz = −y(y − 1)(Np + Rp − Npx − Rpx)
dF(z)/dx = −z(z − 1)(Qe + Se − Rey + Rty)
dF(z)/dy = −z(z − 1)(Re − Rt − Rex + Rtx)
dF(z)/dz = −(z − 1)(Qex − Ce + Sex + Rey − Rty − Rexy + Rtxy) − z(Qex − Ce + Sex + Rey − Rty − Rexy + Rtxy)

(5)

And the eight equilibrium points are introduced into the Jacobi matrix in order to derive their eigenvalues.

The eigenvalues are shown as α1, α2 and α3 in

Table 3. Equilibrium points and their eigenvalues.

Equilibrium Point	α1	α2	α3
(0,0,0)	−Ce	−Cp	Ng − Me − Mp − Cg + Qe + Qp + Rg
(0,0,1)	Ce	Np − Cp + Rp	Ng − Mp − Cg + Qp + Rg − Se
(0,1,1)	Cp − Np − Rp	Ce − Re + Rt	I − Cg + K − Se − Sp
(0,1,0)	Cp	Re − Ce − Rt	K − Cg − Me + Ng + Qe + Rg − Sp
(1,1,1)	Ce − Qe − Se	Cp − Qp − Sp	Cg − I − K + Se + Sp
(1,0,1)	Ce − Qe − Se	Qp − Cp + Sp	Cg + Mp − Ng − Qp − Rg + Se
(1,0,0)	Qe − Ce + Se	Qp − Cp + Sp	Cg + Me + Mp − Ng − Qe − Qp − Rg
(1,1,0)	Cp − Qp − Sp	Qe − Ce + Se	Cg − K + Me − Ng − Qe − Rg + Sp

.

5. Numerical Simulation Analysis

5.1. Parameter Simulation of Stability Point

The following parameters were simulated for various conditions of the equilibrium point. Each line in the figure represents the evolution of government (x), public (y), and enterprises (z) in different states.

In the absence of a zero-waste city’s construction, the equilibrium point is (0,0,0) when Ng − Me − Mp − Cg + Qe + Qp + Rg < 0 should be satisfied, and this point is the stable point of the evolutionary game. In order to satisfy the assumption basis, the assignment is made according to the actual situation. Let Rg = 3, Cg = 2, Se = 6, Qe = 2, Me = 4, K = 3, Qp = 1, Re = 6, Ce = 5, Rp = 7, Cp = 6, Mp = 5, Ng = 2, Np = 7, Rt = 5, Sp = 3, and I = 2. The parameter simulation plots are shown in Figure 1. As time passes, the government, enterprises, and the public tend to participate negatively. The main reason for this is that the expected benefits to the three parties are low; in this case, the overall cost of the three parties’ expenditures is larger, and the public and enterprises fail to obtain satisfactory subsidies when they participate.

A zero-waste city’s construction is initially led by the government, with little participation from enterprises and the public, and the equilibrium point is (1,0,0). At this time, it should satisfy Qe − Ce + Se < 0, Qp − Cp + Sp < 0, Cg + Me + Mp − Ng − Qe − Qp − Rg < 0, and this point is the stable point of the evolutionary game. In order to satisfy the assumption basis, the assignment is made according to the actual situation. Let Rg = 10, Cg = 2, Se = 2, Qe = 2, Me = 4, K = 3, Qp = 1, Re = 6, Ce = 5, Rp = 7, Cp = 6, Mp = 5, Ng = 2, Np = 7, Rt = 5, Sp = 3, and I = 2. The parameter simulation plots are shown in Figure 2. As time passes, the government tends to implement active policies, while enterprises and the public tend to participate negatively. This is mainly due to the lower expected returns and related subsidies to the public and enterprises, while the expected returns to the government are higher when the government responds positively to the national policy and leads the construction of the zero-waste city.

As the construction of a zero-waste city progresses, the government-related subsidies gradually increase, and the enthusiasm of both enterprises and the public gradually increases. There may be a situation in which one party actively participates while the other party negatively participates, and the equilibrium point when the public positively participates while enterprises negatively participate is (1,1,0) in the case that the government adopts active policies. At this point, Cp − Qp − Sp < 0, Qe − Ce + Se < 0, and Cg − K + Me − Ng − Qe − Rg + Sp < 0 should be satisfied, and this point is the stable point of the evolutionary game. In order to satisfy the assumption basis, the assignment is made according to the actual situation. Let Rg = 16, Cg = 2, Se = 2, Qe = 2, Me = 4, K = 3, Qp = 1, Re = 12, Ce = 5, Rp = 10, Cp = 6, Mp = 5, Ng = 2, Np = 7, Rt = 5, Sp = 7, and I = 10. The parameter simulation plots are shown in Figure 3. As time passes, the government and the public tend to positively participate, and enterprises tend to negatively participate, which is mainly due to the higher subsidies from the government for the public in order to increase the enthusiasm of the public to participate but lower subsidies for enterprises.

In the other case of the active participation of one party and negative participation of the other party, the equilibrium point of a positive government policy in which enterprises actively participate and the public negatively participates is (1,0,1). At this point, Ce − Qe − Se < 0, Qp − Cp + Sp < 0, and Cg + Mp − Ng − Qp − Rg + Se < 0 should be satisfied. This point is the stable point of the evolutionary game. In order to satisfy the assumption basis, the assignment is made according to the actual situation. Let Rg = 16, Cg = 2, Se = 6, Qe = 2, Me = 4, K = 3, Qp = 1, Re = 12, Ce = 5, Rp = 10, Cp = 6, Mp = 5, Ng = 2, Np = 7, Rt = 5, Sp = 3, and I = 10. The parameter simulation plots are shown in Figure 4. As time passes, the government and enterprises tend to positively participate, and the public tends to negatively participate, which is mainly due to the higher government subsidies for enterprises in order to increase the enthusiasm of enterprises to participate but lower subsidies for the public.

The construction of a zero-waste city cannot be completed without the cooperation of various stakeholders, and as the construction progresses, the government-led cost in the initial stage gradually increases, and the policy implementation of a zero-waste city requires the joint efforts of the public and enterprises and their support for the government. The equilibrium point of the active participation of the three parties is (1,1,1). At this point, the equilibrium point should be satisfied as Ce − Qe − Se < 0, Cp − Qp − Sp < 0, and Cg − I − K + Se + Sp < 0. This point is the stable point of the evolutionary game. In order to satisfy the assumption basis, the assignment is made according to the actual situation. Let Rg = 16, Cg = 2, Se = 6, Qe = 2, Me = 4, K = 3, Qp = 1, Re = 16, Ce = 5, Rp = 15, Cp = 6, Mp = 5, Ng = 2, Np = 7, Rt = 5, Sp = 7, and I = 19. The parameter simulation plots are shown in Figure 5. As time passes, all three parties tend to actively participate in the game, and at this time, the government subsidies are higher than the cost of active participation for both enterprises and the public. At the same time, the multiparty cooperation in building a zero-waste city greatly improves the international influence of the city and attracts a large amount of overseas investment, so all three parties expect a significant increase in revenue.

In the late stage of a zero-waste city’s construction, the role of the government gradually changes from a leading to a guiding role. A complete zero-waste city development model is formed through the formulation of corresponding incentive policies, and the sustainable development concept and solid waste treatment model become the norm. The equilibrium point is (0,1,1). At this point, Cp − Np − Rp < 0, Ce − Re + Rt < 0, and I − Cg + K − Se − Sp < 0. This point is the stable point of the evolutionary game. In order to satisfy the assumption basis, the assignment is made according to the actual situation. Let Rg = 16, Cg = 2, Se = 6, Qe = 2, Me = 4, K = 3, Qp = 1, Re = 12, Ce = 5, Rp = 10, Cp = 6, Mp = 5, Ng = 2, Np = 7, Rt = 5, Sp = 7, and I = 10. The parameter simulation plots are shown in Figure 6. As time passes, the government tends to implement a negative policy, and the public and enterprises tend to actively participate. At this point, even without government intervention, enterprises and the public can take the initiative to practice green and healthy production and lifestyles, and the government’s function changes to promote the construction of a zero-waste city and the allocation and coordination of public facilities and resources.

5.2. Simulation of Some Important Parameters

The construction of zero-waste cities in China is currently undergoing a shift from government-led to stakeholder-led participation, and this advanced urban management concept needs the support of multiple forces throughout the whole society for better sustainability. Therefore, point (1,1,1) is the most critical, which means that the government, the public, and enterprises are actively building, exploring, and practicing together. Let x = 0.5, y = 0.5, and z = 0.5. For the important parameters of the stable point (1,1,1), a sensitivity analysis was conducted in order to investigate the main reasons for the influence of the current stage on the motivation of the public and enterprises.

In Figure 7, it can be seen that the cost Ce for enterprises to actively participate in the construction of a zero-waste city takes the values of 5, 7, and 10. The cost Cp for the public to actively participate in the construction of a zero-waste city takes the values of 6, 7, and 10. The tendency of both enterprises and the public to actively participate in the construction of a zero-waste city decreases with the increasing cost to both parties, and there is a negative relationship between them. When the cost is lower than the government subsidies, both the public and enterprises are more motivated to participate.

In Figure 8, it can be seen that the expected benefits of enterprises’ active participation Re in the construction of a zero-waste city take the values of 6, 10, and 16. The expected benefits of the public’s positive participation Rp in the construction of a zero-waste city take the values of 5, 10, and 15. As government subsidies continue to increase, the tendency of both enterprises and the public to actively participate is higher, and they are positively correlated.

In Figure 9, it can be seen that the government subsidies for enterprises to actively participate in the construction of a zero-waste city take the values of two, four, and six, and the government subsidies for the public to positively participate in the construction of a zero-waste city take the values of two, five, and seven. The tendency of both enterprises and the public to actively participate in the construction of a zero-waste city is higher as the expected benefits to both parties increase, and there is a positive relationship between the two. When the government subsidies are much lower than the cost of active participation by both parties, both enterprises and the public tend to participate negatively.

In Figure 10, it can be seen that the government fines Qe for the negative participation of enterprises in the zero-waste city take the values of two, three, and four. The government fines Qp for the negative participation of the public in the zero-waste city take the values of one, two, and three. As the government fines become higher, the tendency of both enterprises and the public to positively participate in the construction of the zero-waste city becomes higher, and the two are positively correlated. However, Qe has a slight effect on enterprises’ strategic choices.

In Figure 11, it can be seen that the values of the initial revenue Rt are taken as 5, 15, and 20, and the values of the damage to the public from environmental pollution Np are taken as 3, 7, and 10 when the zero-waste city is not completed. The lower the initial revenue of an enterprise, the more its strategic choice is inclined toward active participation. The higher the damage to the environment suffered by members of the public, the more their strategy tends toward active participation.

6. Discussion

6.1. Conclusions

In this paper, we analyzed the strategic choices of each stakeholder under different assumptions by constructing an evolutionary game model with the government, the public, and enterprises as the main parties based on prospect theory and the actual situation. The simulation of each stage of the zero-waste city construction process and the sensitivity analysis of the current stage were carried out in order to derive the influences of relevant important parameters on the construction of a zero-waste city, and the following conclusions were drawn based on the evolutionary results:

• In the absence of a zero-waste city’s construction, the expected benefits and participation costs for each stakeholder influence the strategic choices of each party. As social acceptability and involvement increase, the faster the process of building a zero-waste city becomes.
• At the early stage of a zero-waste city’s construction, the leading role of the government and related subsidies can promote the enthusiasm of enterprises and the public to participate in the construction of the zero-waste city. As the construction progresses, the joint participation of the three parties can promote the maximization of benefits, which is the optimal choice for the three parties at this time. After the construction of the zero-waste city has formed a perfect sustainable development model, even if government intervention is not needed, all stakeholders will choose to actively participate in the construction of the zero-waste city.
• The construction of a zero-waste city requires long-term exploration and practice, and China is currently in the transition period from government-led to government-directed planning. The higher the government subsidies and fines are, the more both enterprises and the public tend to actively participate in the project. In addition, a zero-waste city’s construction is influenced by other factors beyond benefits and costs. Higher environmental resource endowment and the perfection of solid waste processing technology can facilitate the process of building a zero-waste city, among which solid waste processing technologies play a key role in addressing the challenges posed by the growing volume of waste. Effective waste management, transportation, and recycling through the use of innovative technologies such as separation, segregation, and anaerobic treatment, the conversion of solid waste into renewable energy and thermal energy, and landfill space reduction are important for sustainable development.

6.2. Recommendations

Based on the above conclusions, the following suggestions are made with the aim of realizing the construction of a zero-waste city in China:

• Improve the laws and regulations related to a zero-waste city, improve the reward and punishment mechanism, and mobilize the enthusiasm of all social subjects. Guide all social entities to participate in the recycling mode of waste separation and collection, transportation, and treatment in legislation and policy. Supervise relevant enterprises by setting solid waste standards and adopting financial and tax incentives to encourage the use of clean energy and reduce the incremental amount of solid waste [30]. In Australia, the implementations of the Zero Waste Act and the Plastic Bag Ban stand as exemplary instances in which the South Australian government has demonstrated remarkable leadership. These measures serve as concrete evidence of a commitment to fostering a significant push towards the principles of the 3Rs: reduce, reuse, and recycle. South Australia has also implemented a landfill levy, which imposes a fee on waste disposed of in landfills. The levy is designed to discourage landfilling and incentivize waste reduction, recycling, and resource recovery [31]. In 2019, the Council of Australian Governments (COAG) Energy Council endorsed a National Hydrogen Strategy to support the growth of the domestic and export hydrogen industry.
• Promote change in the government’s role and the benign interactions between multiple subjects. While clarifying the strategic goal of a zero-waste city, the government’s function can be transformed from one of complete domination to supervision and propaganda and the coordination of various stakeholders to cooperate. This role would include planning and leading various social subjects to realize solid waste utilization more efficiently and promoting the normalization of sustainable development concepts and lifestyles. In the Netherlands, Amsterdam has set the goal of becoming a fully circular city by 2050 [32]. The city has implemented various measures through which to achieve this, including promoting waste separation and recycling, encouraging the reuse of materials, and supporting innovative initiatives that promote a circular economy. Amsterdam also hosts events, such as the Amsterdam Circular Challenge in 2017, which invited startups and entrepreneurs to propose innovative solutions for waste reduction and resource efficiency.
• Improve the efficiency of solid waste resource utilization and promote the establishment of a circular economy and sustainable development. Drawing on the solid waste treatment models of developed countries and regions, we need to invest in relevant scientific research and promote innovation in solid waste treatment technology [33]. For example, regarding innovation in processing technology for traditional food waste, through the promotion of biological treatment technologies, organic waste such as food waste solids are fermented in anaerobic systems to produce biogas and increase natural gas production. In addition, food waste is a clean and abundant source of nutrients and carbon that could constitute a feedstock for organic fertilizer manufacturing, and the practice of recycling food waste and harnessing its potential as an organic N-fertilizer for sustainable agriculture holds great promise [34]. Support related industries and disciplines in order to improve resource utilization and promote the innovative development of a zero-waste city [35].

6.3. Research Deficiencies and Prospects

In this paper, we combined prospect theory with evolutionary game theory to conduct numerical simulations, draw corresponding conclusions, and provide suggestions for the construction of a zero-waste city, but there are still some limitations. Only the government, enterprises, and the public were selected as the game subjects among the stakeholders, and no more subjects were added. For the parameter setting and numerical simulations, we mainly started with the costs and benefits, and other parameters were not explored in depth, such as the public’s complaints against the government, the influence of the city, etc., which need to be studied further. Meanwhile, the impacts of different strategies employed by different subjects on the construction of a zero-waste city could be analyzed for other social subjects in the future.