| A Reverse Production System (RPS) is a network of transportation logistics and processing functions that collects, refurbishes, and demanufactures for reuse/recycle used or end-of-life products. In this thesis, I focus on the RPS strategic decisions of a processor and collectors when the collection network and contracts for materials can be co-designed.;The research problem is motivated by the need of material processors to ensure a consistent flow of material from collectors at a cost that will enable them to be competitive with virgin raw materials. The failure to develop a cost-effective collection network can lead to poor overall economics where expensive processing assets are not fully utilized. The three key problems from the processor's point of view are: (1) how to design a strategic collection network; (2) how to be competitive in the collected materials market place when significant investment is at risk; and (3) how to avoid overpaying for materials when collectors are in regions with different volumes and costs.;The multiple goals of this research are: (1) to integrate the contract and strategic network design in RPS; (2) to develop contract mechanism designs to improve the performance under incomplete information and study the value of information (complete vs. incomplete); and (3) to introduce and analyze new strategic network models for effectiveness in solution quality and time.;Concepts of mathematical optimization, contract theory, and game theory are utilized in proposing models that couple contract and network problems, including lump sum and variable volume contracts. |
