Production decisions in a hybrid manufacturing–remanufacturing system with carbon cap and trade mechanism

Xiangyun Chang, Haiyang Xia, Huiyun Zhu, Tijun Fan and Hongqing Zhao

International Journal of Production Economics, 2015, vol. 162, issue C, 160-173

Abstract: We study a monopolist manufacturer who makes new products in the first period and makes new and remanufactured products simultaneously in the second period. The manufacturing and remanufacturing activities in the two-period planning horizon are limited by carbon cap and trade mechanism (CCT-mechanism), and the manufacturer has to determine the optimal production quantities for each period. With the consideration of CCT-mechanism, we propose two profit-maximization models for the independent demand market (ID-market) and the substitutable demand market (SD-market), respectively, and characterize the corresponding optimal production decisions. Based on the theoretical and numerical studies, we analyze the impacts of the CCT-mechanism and carbon related parameters. The results show that the CCT-mechanism has a great influence on firm׳s production decisions of manufacturing and remanufacturing. In specific, the carbon price is more effective in controlling productions and emissions compared with the carbon cap in both types of market. In the ID-market, the CCT-mechanism cannot induce the firm to choose the low-carbon remanufacturing technology, while in the SD-market, it may induce the firm to choose the low-carbon remanufacturing technology.

Keywords: Carbon cap; Carbon trade; Production decisions; Remanufacturing (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (45)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0925527315000328
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:proeco:v:162:y:2015:i:c:p:160-173

DOI: 10.1016/j.ijpe.2015.01.020

Access Statistics for this article

International Journal of Production Economics is currently edited by Stefan Minner

More articles in International Journal of Production Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().