The Optimal Pricing Analysis for Remanufactured Notebooks in a Duopoly Environment

Ruey-Chyn Tsaur
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Ruey-Chyn Tsaur: Department of Management Sciences, Tamkang University, No.151, Yingzhuan Rd., Tamsui Dist., New Taipei City 25137, Taiwan

Sustainability, 2020, vol. 12, issue 2, 1-15

Abstract: The information technology industry plays an important role in Taiwan’s manufacturing sector, and its total notebook production ranks top in the world. The rapid development of IT products has caused many of these products to be discarded, although most of them can be recycled, remanufactured, and reused. In order to reduce the manufacture of new products and the associated carbon emissions, this study aims to discover the optimal subsidy policy for remanufactured notebooks in the green market, focusing on the pricing of remanufactured notebooks and maximizing manufacturers’ profits while retaining optimal social welfare for consumers. We use a two-stage game theory model to identify the optimal government subsidy policies for a duopoly environment. The results are based on the subsidy ratio between consumer and manufacturers, as this factor is important to the entire green supply chain; manufacturers can still reap optimal profits by only producing new or remanufactured products, and the government should be aware of the likelihood of manufacturers colluding and of the need to intervene when necessary to avoid sacrificing social welfare.

Keywords: green supply chain; duopoly; social welfare analysis; Cournot equilibrium (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2020
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