Closed-loop Supply Chain Coordination Mechanism Considering The Government Subsidies

Nearly 40 years of reform and opening-up has witnessed the rapid growth of Chinese economy,which has made the China become a very important economies in the world economy.But China's economic growth has vastly developed at the cost of the destruction of the environment and the waste of resources.On the 18th of the communist party,the central government has put forward the construction of ecological civilization,advocating that building a resource-conserving and environment-friendly society is the inevitable requirement of scientific development and sustainable development in our country.How to realize the less resource consumption,less environmental pollution,but higher social benefit and a better living environment has become a hot point and focus of the state and society.Following the supply chain coordination research upsurge,the closed-loop supply chain coordination research has gradually risen.Recycling remanufacturing can save resources and protect the environment,and it has the positive external economy,thus the market failure leads to the government's public policy intervention.Because of this remanufacturing as a kind of important way of realizing recycling economy has caused the wide attention of the society.Based on the analysis of the optimal incentive theory of information economics,it is studied on how to design the optimal recycling price incentive contracts in order to realize the closed loop supply chain coordination.Firstly,it is assumed that the new products and manufactured goods are homogeneous,and then the optimal recycling price contract is designed between a manufacturer that produces the new products and remanufactured goods at the same time and a single recycler.Then it is established the closed-loop supply chain game model in which a government subsidy remanufacturing activities,obtained the optimal management decision of related companies and analyzed the equilibrium results.It is concluded that the optimal recycling price incentive contracts can realize the closed-loop supply chain coordination.Secondly,it is assumed that the new products and manufactured goods are homogeneous,and then the optimal recycling price contract is designed between a manufacturer that produces the new products and remanufactured goods at the same time and a single recycler.Then it is established the differentiation competitive closed-loop supply chain game model in which a government subsidy remanufacturing activities and a single manufacturer,a single recycler and two retailers which are Bertrand price competitors,obtained the optimal management decision of related companies and analyzed the equilibrium results.It is concluded that the optimal recycling price incentive contracts can realize the closed-loop supply chain coordination with multiple retailers competing on retailer price.Finally,it is assumed that the new products and manufactured goods are homogeneous,and then the optimal recycling price contract is designed between a remanufacturer that produces the remanufactured goods and a single recycler.Then it is established the closed-loop supply chain game model in which a government subsidy remanufacturing activities and a single manufacturer producing new products and a remanufacturer producing remanufacturing products sell goods to their respective retailers respectively,obtained the optimal management decision of related companies and analyzed the equilibrium results.It is concluded that the optimal recycling price incentive contracts can realize the closed-loop supply chain coordination with multiple manufacturers competing on manufacturing price.As a new way of coordinating the closed-loop supply chain,the optimal recycling price incentive contract,which has theoretical and practical significance,can be adapted to different industrial organization,providing a new effective way of thinking for the relevant government departments to make policy and the relevant enterprises in the closed-loop supply chain to make decisions.