Research On Remanufacturing Authorization Strategy In The Cap-and-trade Policy Context

As the national emission reduction target of “dual carbon” proposes and cap-and-trade policy implements,energy conservation & emission reduction has become the key content in the firms’ production process.Remanufactured products have caught lots of attentions from manufacturing firms because of the characteristics of energy saving and environmental protection.However,the original manufacturer(OEM)may not engage in remanufacturing due to the constraints of corporate business strategies,high recovery costs,and concerns about competition.Besides,it is also difficult to prevent the development of third-party remanufacturing because of the difficulty and high costs of rights protection,and concerns about social reputation.Thus,third-party remanufacturing firms(IR)are developing rapidly.Given that the cannibalisation of remanufactured products on new products and the potential value of used products,many OEMs have begun to cooperate with IR for brand licensing in order to obtain licensing fees and expand after-sale business.For IR,licensing can also solve a big obstacle which hinders the development of remanufactured products,that is,“low consumer acceptance for remanufactured products”.Although OEMs may encounter fierce competition between new and remanufactured products and IRs needs to pay for higher licensing fees,it is possible for OEMs and IRs to cooperate with each other.In this context,exploring the OEMs’ and IRs’ willingness to authorize cooperation and its influencing factors has become a practical problem that needs to be solved urgently.The authorization cooperation also has different performances in different market situations.Therefore,this paper establishes the unlicensed and licensed models in different market situations,and explores the authorization strategies of OEMs and IRs through comparative and result analysis.The specific research contents are as follows:Firstly,chapter 2 studies the Stackelberg game dominated by the original equipment manufacturer who produces new products and followed by the IR who produces remanufactured products.We establish authorized and unauthorized models,and obtain the equilibrium solutions by backward induction.Then,the impacts of authorization on OEM’s and IR’s pricing decisions,product demands and firms’ profits are obtained by comparing the model,and the factors that influence the willingness of OEM and IR to authorize cooperation are explored.It is found that the higher new product’s production cost,the more OEMs are willing to authorize remanufacturing,while the willingness of IRs to accept authorization is mainly positively related to the utility increasement brought by the authorization.Secondly,based on chapter 2,chapter 3 considers the case of IR owning private remanufacturing cost information.We also explore the factors which influence the willingness of OEM and IR to authorize through solving and comparing models,and further explores the impacts of information asymmetry on their authorization willingness.We find that OEM is more willing to authorize when information is symmetrical,and IR is more willing to accept authorization when the remanufacturing cost is low.In addition,we also find that information asymmetry is always disadvantageous to OEM,and IR is only willing to disclose the cost information when the remanufacturing cost is high.In other cases,information asymmetry can bring dividends.Thirdly,remanufactured product competition and new product competition are considered in chapter 4 and chapter 5 respectively.In the case of remanufactured products competition,that is,the OEM also remanufactures,it is found that for OEMs that produce new products and remanufactured products at the same time,authorizing IRs to remanufacture does not affect new product demands but hurts the remanufactured product demands.In the case of high-quality or low-quality IR remanufactured products,the OEM’s licensing strategy may be quite different.In the case of new product competition,through comparing the optimal decisions before and after authorization,it is found that the price change of OME with low-quality product after authorization is larger,which is twice than the price change of OEM with high-quality product.The willingness to license for OEM with high-quality product and IR in the case of product competition is the same as that in the case of without product competition,while the effect of utility growth on the profit of OEM with low-quality product after licensing is opposite to that of IR.Finally,by analyzing the environmental performances in different market situation,the impacts of authorization on environmental performances are explored.It is found that in the basic model with complete information and no product competition,authorization plays a positive role in the overall improvement of environmental performance,however,the impacts of authorization are more complicated in other cases.At the same time,the effects of some parameters on firms’ profit and product demand are further explored through numerical examples,and abundant conclusions are also obtained when verifying the correctness of propositions.