Optimal Decisions in an Authorized Remanufacturing Closed-Loop Supply Chain under Dual-Fairness Concerns
Abstract
:1. Introduction
- (1)
- How do the third party’s distributional fairness concerns and peer-induced fairness concerns influence optimal decisions of the authorized remanufacturing CLSC enterprises under the retailer’s different attitudes towards the third party’s fairness concerns?
- (2)
- How do the authorized remanufacturing CLSC members’ profits and environmental impact change with third party’s dual-fairness concerns? How should the retailer choose its attitude towards the dual-fairness concerns of the third party to maximize profit?
2. Literature Review
2.1. Authorization in Remanufacturing
2.2. Fairness Concerns in Supply Chain
3. Problem Description and Formulation
- 1.
- The market capacity is . Consumers’ willingness-to-pay (WTP) for a new product is , which follows the uniform distribution in the interval . Consumers’ WTP for a remanufactured product is , where is the consumers’ acceptance of the remanufactured product relative to the new product. Consumers’ utility from purchasing new and remanufactured products are and , respectively. If and , the consumers will buy new products; if and , the consumers will buy remanufactured products. The demand functions for the new and remanufactured products can be derived as follows [9,42]:
- 2.
- 3.
- 4.
- 5.
- Referring to Xia et al. [21], we consider environmental impact, including product production and product disposal. The unit environmental impacts during the production of new and remanufactured products are and respectively. The environmental impact of unit unreturned product disposed is . And . The overall environmental impact is expressed as
4. Model Solution
4.1. The Retailer Considers the Third Party’s Dual-Fairness Concerns (Model F)
4.2. The Retailer Does Not Consider the Third Party’s Dual-Fairness Concerns (Model N)
4.3. The Retailer Only Considers the Third Party’s Distributional Fairness Concerns (Model D)
4.4. The Retailer Only Considers the Third-Party’s Peer-Induced Fairness Concerns (Model P)
5. Numerical Analysis
6. Conclusions
Author Contributions
Funding
Institutional Review Board Statement
Informed Consent Statement
Data Availability Statement
Acknowledgments
Conflicts of Interest
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Symbols | Description |
---|---|
Wholesale price of new products (decision variable) | |
Unit authorization fee (decision variable) | |
Quantity of new products (decision variable) | |
Quantity of remanufactured products (decision variable) | |
Price of new product | |
Price of remanufactured product | |
Unit cost of new product | |
Unit cost of remanufactured product | |
Market capacity | |
Consumer WTP for the new product | |
Consumer acceptance of the remanufactured product | |
Scaling parameter of collection cost | |
Coefficient of distributional fairness concerns | |
Coefficient of peer-induced fairness concerns | |
Environmental impact per unit of new and remanufactured products during production, respectively | |
Environmental impact of unit product uncollected by third party | |
The total environmental impact | |
, m is the manufacturer, r is the retailer, t is the third party | |
The utility of the third-party |
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Deng, Z.; Shaharudin, M.R.; Shariff, S.S.R.; Tseng, M.-L. Optimal Decisions in an Authorized Remanufacturing Closed-Loop Supply Chain under Dual-Fairness Concerns. Sustainability 2024, 16, 7609. https://doi.org/10.3390/su16177609
Deng Z, Shaharudin MR, Shariff SSR, Tseng M-L. Optimal Decisions in an Authorized Remanufacturing Closed-Loop Supply Chain under Dual-Fairness Concerns. Sustainability. 2024; 16(17):7609. https://doi.org/10.3390/su16177609
Chicago/Turabian StyleDeng, Zichun, Mohd Rizaimy Shaharudin, S. Sarifah Radiah Shariff, and Ming-Lang Tseng. 2024. "Optimal Decisions in an Authorized Remanufacturing Closed-Loop Supply Chain under Dual-Fairness Concerns" Sustainability 16, no. 17: 7609. https://doi.org/10.3390/su16177609