Proceedings of the 4th International Conference on Informatization Economic Development and Management, IEDM 2024, February 23–25, 2024, Kuala Lumpur, Malaysia

Research Article

Decentralized Decision-Making Model for Closed-Loop Supply Chain with Remanufacturing Considering Premium & Penalty Mechanism of Government

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  • @INPROCEEDINGS{10.4108/eai.23-2-2024.2345884,
        author={Kaicheng  Qiu},
        title={Decentralized Decision-Making Model for Closed-Loop Supply Chain with Remanufacturing Considering Premium \& Penalty Mechanism of Government},
        proceedings={Proceedings of the 4th International Conference on Informatization Economic Development and Management, IEDM 2024, February 23--25, 2024, Kuala Lumpur, Malaysia},
        publisher={EAI},
        proceedings_a={IEDM},
        year={2024},
        month={5},
        keywords={closed-loop supply chain; remanufacturing; premium \& penalty mechanism; decentralized decision-making model},
        doi={10.4108/eai.23-2-2024.2345884}
    }
    
  • Kaicheng Qiu
    Year: 2024
    Decentralized Decision-Making Model for Closed-Loop Supply Chain with Remanufacturing Considering Premium & Penalty Mechanism of Government
    IEDM
    EAI
    DOI: 10.4108/eai.23-2-2024.2345884
Kaicheng Qiu1,*
  • 1: Fudan University
*Contact email: 3198372344@qq.com

Abstract

Taking a typical closed-loop supply chain (CLSC) system which consists of a single supplier and retailer as the research objective, this study intends to find optimal decisions for all companies in CLSC system under premium & penalty mechanism of government working on the reverse logistics enterprises. A decentralized decision model is established based on the game theory, which simultaneously determines the optimal decision of all parties mentioned and shows the influence of premium & penalty mechanism of government on the closed-loop supply chain. The conclusions are as follows: (1) The premium & penalty mechanism of government contributes to increasing retailers’ profit; (2) Whether the premium & penalty mechanism of government positively influence the recycling rate of reverse logistics enterprise or not depends on the interaction of premium & penalty coefficient k and recycling fixed cost coefficient C0. (3) If fixed cost recovery coefficient meets certain conditions, the efficiency of the closed-loop supply chain will be improved. So, reducing the recovery cost is essential to promote the efficient of closed-loop supply chain. The results of this paper not only have a practical effect on promoting the efficiency of CLSC with remanufacturing, but also provide a decision-making reference for the government to make recycling and reusing policy of renewable resources.