A Research on Jointed Pricing Decision of ELVs Recycling Products Based on Quality Differentiation and WTP Differentiation

Abstract

Abstract:

In order to price the recycling products orderly and reasonably, the jointed pricing decision of new auto parts, remanufactured auto parts and reusable auto parts under uncertain demand from the perspective of the solo manufacturer are focused on. Firstly, product demand function is set using utility theory based on quality and willingness to pay（WTP）differentiation of above-mentioned new products, remanufactured products and reusable products. Then a jointed pricing model of products is built based on product demand function, and the solutions of the model are analyzed numerically. The results show that the new and remanufactured product’s pricing and three products’ productivity will decrease while the reusable product’s pricing and manufacturer’s profit will increase with the increase of quality of reusable products.

Key words: quality differentiation, willingness to pay（WTP）differentiation, jointed pricing, end-of-life vehicles (ELVs)

CAI Keyuan, ZOU Ye, WANG Zengqiang. A Research on Jointed Pricing Decision of ELVs Recycling Products Based on Quality Differentiation and WTP Differentiation[J]. Industrial Engineering Journal .

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