Development of Sustainable Recycling Investment Framework Considering Uncertain Demand and Nonlinear Recycling Cost

Hyunsoo Lee
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Hyunsoo Lee: School of Industrial Engineering, Kumoh National Institute of Technology, Gumi 39177, Korea

Sustainability, 2019, vol. 11, issue 14, 1-18

Abstract: This paper presents a more active and efficient recycling investment strategy that considers the balances among the current production constraints, manufacturing profits, and recycling investments for a sustainable circular economy as compared to the current methods. While existing production planning has numerous uncertainties and nonlinear characteristics, the circular economy-based production planning constitutes more complex uncertainties and nonlinear characteristics that result from an uncertain return rate, demand uncertainties, and nonlinear return on investment costs. This paper suggests a stochastic nonlinear programming model-based active recycling investment framework so as to generate a more effective process plan to handle these characteristics. In the proposed framework, recycling investment strategies are quantitatively analyzed when considering uncertain demand and unclear production conditions. In addition, the effective solving techniques for the circular economy based production framework are obtained while using Monte-Carlo based sample average approximation and memetic algorithm. To prove the effectiveness of the proposed framework, it is implemented for a given system and the numerical analyses that were conducted for the various sustainable manufacturing scenarios.

Keywords: recycling investment strategy; demand uncertainty; Stochastic nonlinear Programming; Monte-Carlo based sample average approximation method; memetic algorithm (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2019
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