Carbon Reduction Subsidy, Remanufacturing Subsidy or Consumer Recycling Subsidy? A Low-Carbon Closed-Loop Supply Chain Network Operation Decision
Abstract
:1. Introduction
- How do the CO2e reduction subsidy, remanufacturing subsidy and consumer recycling subsidy policies affect the production, recycling, CO2e reduction and profit distribution of the LC-CLSCN system?
- When the three policies exist separately, which policy is more conducive to promoting the system’s forward and reverse product circulation, reducing CO2e and promoting the benefits of members and the system?
- Under the coexistence of these three subsidy policies, which policy has a more significant impact on the LC-CLSCN system?
2. Literature Review
2.1. The Decision of CLSCN
2.2. LC-CLSC and Sustainable CLSC Operations Considering Government Policy
2.3. The Operation of LC-CLSCN Considering Government Policy
2.4. Research Gaps
3. Problem Description and Assumptions
- According to the research objective, to ensure the rationality of the model, we assume that the baseline CO2e per unit of a new product is and the baseline CO2e per unit of a remanufactured product is , where is the CO2e reduction coefficient of remanufactured products. To reduce CO2e, we assume that manufacturers implement CO2e reduction. According to Wang and Wu [4], we assume that is the CO2e reduction cost of a manufacturer, where is the CO2e reduction cost coefficient and is the CO2e reduction per unit product (CO2e reduction level). After the manufacturer reduces CO2e, the CO2e per unit of new product is , and the CO2e per unit of remanufactured product is .
- Under the remanufacturing subsidy policy, consumer recycling subsidy policy and CO2e reduction subsidy policies, this paper provides a new assumption that there are different subsidy environments in the supply chain system, that is, the government can implement these three policies separately or simultaneously. In the remanufacturing subsidy policy, the government offers a unit of remanufactured product subsidy to manufacturers. Regarding the consumer recycling subsidy policy, the government provides a unit recycling subsidy to consumers. Under the CO2e reduction subsidy policy, the government provides a unit CO2e reduction subsidy to manufacturers.
- This study adopts a single-period model; that is, members are in a stable and mature period. During this period, prices, market demand and recycling rate are relatively stable. Therefore, it is assumed that all recycled waste products are used for remanufacturing, and consumers can distinguish between new products and remanufactured products. Many studies have made similar assumptions, such as Hammond and Beullens [22] and Chang et al. [57].
- To better analyze the impact of three subsidy policies on manufacturers’ CO2e reduction. This study only considers CO2e in the process of product production and remanufacturing and does not consider CO2e in the process of recycling and marketing. Many studies also made a similar model assumption, such as Zhang et al. [14], Luo et al. [34] and Tao et al. [52].
4. Research Method and Mathematical Model Formulation
4.1. Research Method
4.2. Mathematical Model Formulation
4.2.1. Manufacturers
4.2.2. Retailers
4.2.3. Markets
4.2.4. The LC-CLSCN Equilibrium Model under Different Subsidy Policies
5. Numerical Examples
5.1. Numerical Example 1
5.2. Numerical Example 2
6. Discussion, Implications and Recommendations
6.1. Results and Discussion
6.2. Implications
6.3. Management Recommendations
6.3.1. Government
6.3.2. Enterprise Members
7. Conclusions, Limitations and Future Direction
7.1. Conclusions
7.2. Limitations and Future Direction
Author Contributions
Funding
Data Availability Statement
Acknowledgments
Conflicts of Interest
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Literature | SS-SC | SCN | Government Policy | Method | ||||||
---|---|---|---|---|---|---|---|---|---|---|
RR | LC | RR | LC | CRP | CRSP | RSP | Other | GT | VI | |
Wang and Wu [4] | √ | √ | √ | √ | ||||||
Cheng et al. [5], Zhou et al. [13] | √ | √ | √ | √ | √ | |||||
Wang et al. [11] | √ | √ | √ | √ | ||||||
Cao et al. [9], Li et al. [19] | √ | √ | √ | |||||||
Zhang et al. [14] | √ | √ | √ | √ | √ | |||||
Jena et al. [15] | √ | √ | √ | √ | ||||||
Wan [17] | √ | √ | √ | √ | √ | |||||
Xu et al. [20], Mondal and Giri [44], Shu et al. [46] | √ | √ | √ | √ | ||||||
Xia et al. [35] | √ | √ | √ | |||||||
Shu et al. [36] | √ | √ | √ | √ | √ | |||||
Zhao et al. [38] | √ | √ | √ | √ | ||||||
Zhang and Yu [39] | √ | √ | √ | √ | √ | |||||
Song et al. [42], | √ | √ | √ | |||||||
Wu et al. [24], Zhang et al. [48], Cheng et al. [49], Allevi et al. [51], Tao et al. [52] | √ | √ | √ | √ | √ | |||||
Bian and Xuan [53] | √ | √ | √ | √ | ||||||
Li et al. [54] | √ | √ | √ | |||||||
Chan et al. [55] | √ | √ | √ | |||||||
This paper | √ | √ | √ | √ | √ | √ | √ |
Symbols | Descriptions |
---|---|
, | The conversion rate of raw materials and waste products, , |
, | The number of new products and remanufactured products produced by manufacturer m, , |
, | The number of new products and remanufactured products wholesaled by manufacturer m to retailer s, , |
, | The number of new products and remanufactured products retailed by retailer s to market d, , |
, | The price of new products and remanufactured products wholesaled by manufacture m to retailer s |
, | The price of new products and remanufactured retailed by retail s to market d |
, | The number and price of waste products recycled by manufacturer m from market d, |
, | The price of new products and remanufactured products purchased by consumers in market d, , |
, | The new product and remanufactured product demand functions of market d, , |
, | The production costs of new products and remanufactured products of manufacturer m, , |
, | The transaction costs between manufacturer m and retailer s (retailer s and manufacturer m borne, respectively), , |
The transaction costs between retailer s and market d (retailer s borne), | |
, | The transaction costs borne by consumers buying new products and remanufactured products, respectively, , |
Recycling negative utility function | |
Waste product recycling rate | |
The member’s profit, |
1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | ||
---|---|---|---|---|---|---|---|---|---|---|
G2 | 7.8650 | 7.8726 | 7.8802 | 7.8878 | 7.8954 | 7.9030 | 7.9105 | 7.9181 | 7.9257 | |
G1 | 7.8654 | 7.8734 | 7.8814 | 7.8894 | 7.8974 | 7.9054 | 7.9133 | 7.9213 | 7.9293 | |
G3 | 7.9342 | 8.0117 | 8.0898 | 8.1687 | 8.2482 | 8.3284 | 8.4094 | 8.4910 | 8.5734 | |
G1 | 6.5606 | 6.5682 | 6.5758 | 6.5834 | 6.5910 | 6.5986 | 6.6061 | 6.6137 | 6.6213 | |
G2 | 6.5610 | 6.5690 | 6.5770 | 6.5850 | 6.5930 | 6.6010 | 6.6089 | 6.6169 | 6.6249 | |
G3 | 6.6298 | 6.7073 | 6.7854 | 6.8643 | 6.9438 | 7.0240 | 7.1050 | 7.1866 | 7.2690 | |
G2 | 5.0443 | 5.0519 | 5.0595 | 5.0671 | 5.0747 | 5.0823 | 5.0898 | 5.0974 | 5.1050 | |
G1 | 5.0447 | 5.0527 | 5.0607 | 5.0687 | 5.0767 | 5.0847 | 5.0926 | 5.1006 | 5.1086 | |
G3 | 5.1135 | 5.1910 | 5.2691 | 5.3480 | 5.4275 | 5.5077 | 5.5887 | 5.6703 | 5.7527 | |
G2 | 0.3497 | 0.3498 | 0.3500 | 0.3501 | 0.3503 | 0.3505 | 0.3506 | 0.3508 | 0.3509 | |
G1 | 0.3497 | 0.3499 | 0.3500 | 0.3502 | 0.3503 | 0.3505 | 0.3507 | 0.3508 | 0.3510 | |
G3 | 0.3511 | 0.3527 | 0.3542 | 0.3557 | 0.3573 | 0.3588 | 0.3602 | 0.3617 | 0.3631 | |
G2 | 0.1565 | 0.1641 | 0.1717 | 0.1793 | 0.1869 | 0.1945 | 0.2020 | 0.2096 | 0.2172 | |
G1 | 0.1569 | 0.1649 | 0.1729 | 0.1809 | 0.1889 | 0.1969 | 0.2048 | 0.2128 | 0.2208 | |
G3 | 0.2257 | 0.3032 | 0.3813 | 0.4602 | 0.5397 | 0.6199 | 0.7009 | 0.7825 | 0.8649 | |
G2 | 14.885 | 14.767 | 14.647 | 14.528 | 14.408 | 14.288 | 14.168 | 14.047 | 13.926 | |
G1 | 14.879 | 14.754 | 14.629 | 14.503 | 14.377 | 14.250 | 14.123 | 13.996 | 13.869 | |
G3 | 13.791 | 12.540 | 11.249 | 9.9167 | 8.5428 | 7.1264 | 5.6664 | 4.1619 | 2.6121 |
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Duan, C.; Yao, F.; Zhang, Q.; Wang, J.; Wang, Y. Carbon Reduction Subsidy, Remanufacturing Subsidy or Consumer Recycling Subsidy? A Low-Carbon Closed-Loop Supply Chain Network Operation Decision. Systems 2023, 11, 126. https://doi.org/10.3390/systems11030126
Duan C, Yao F, Zhang Q, Wang J, Wang Y. Carbon Reduction Subsidy, Remanufacturing Subsidy or Consumer Recycling Subsidy? A Low-Carbon Closed-Loop Supply Chain Network Operation Decision. Systems. 2023; 11(3):126. https://doi.org/10.3390/systems11030126
Chicago/Turabian StyleDuan, Caiquan, Fengmin Yao, Qiwen Zhang, Jiali Wang, and Ying Wang. 2023. "Carbon Reduction Subsidy, Remanufacturing Subsidy or Consumer Recycling Subsidy? A Low-Carbon Closed-Loop Supply Chain Network Operation Decision" Systems 11, no. 3: 126. https://doi.org/10.3390/systems11030126