Research on Closed-Loop Remanufacturing Supply Chain with Third-Party Collection and Government Subsidies

Abstract

Abstract: By taking government subsidy as an incentive function into account, a closedloop remanufacturing supply chain with thirdparty collection is addressed in this paper. A game model is presented to describe the operation of the supply chain. With this model, operational law of the supply chain and the effect of government subsidy are analyzed. It is found that, in the case of noncooperative game, the supply chain system cannot be optimally operated. However, with cooperative game model, perfect coordination of the supply chain can be achieved by using revenue and costsharing contract. A numerical example is used to verify its theoretical correctness and validity of contract design.

Key words: government subsidy, game theory, supply chain, supply chain coordination

Xin Guang-qian1, Shi Cheng-dong1 , Xie Yun2 , Yan Hou-qiang2 , Lu Hong-bin2. Research on Closed-Loop Remanufacturing Supply Chain with Third-Party Collection and Government Subsidies[J]. Industrial Engineering Journal , 2012, 15(6): 70-75.

References

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