Impact of waste management and regulatory mechanism on sustainable EOQ model with controllable non-instantaneous deterioration and trade credit-and carbon-sensitive demand

Sharad Kumar, Seema Agrawal and Dharmendra Yadav

International Journal of Operational Research, 2024, vol. 50, issue 1, 35-62

Abstract: Non-instantaneous deterioration, trade credit, waste management, carbon sensitive demand, and preservation technology all have a significant impact on inventory control policies. So, taking into cognisance of these issues, an economic order quantity model has been developed to minimise the total inventory cost by considering the preservation technology (PT) to mitigate the rate of deterioration and to increase the length of the non-deterioration period. The objective of achieving financial sustainability is accomplished by taking into account the trade credit period. Consumers are becoming more environmentally conscious. As a result, it is assumed that demand rate is a function of the trade credit period and carbon level. Shortages are allowed with partially backlogging at a constant rate. To reduce carbon emissions, two different mechanisms, namely carbon tax and carbon cap-and-trade, are used. A solution algorithm is developed to obtain an optimal solution. The findings revealed that total inventory costs are reduced efficiently due to preservation technology and trade credit. According to the findings, environmentally friendly decision-makers preferred a carbon tax mechanism over a carbon cap-and-trade system. Analysis also suggested that the trade credit period has a positive impact on the total inventory cost.

Keywords: waste management; trade credit; carbon tax; carbon cap-and-trade; partial backlogging. (search for similar items in EconPapers)
Date: 2024
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