Market prices of remanufactured, used and new items: Evidence from eBay

João Quariguasi Frota Neto, Jacqueline Bloemhof-Ruwaard and Charles Corbett

International Journal of Production Economics, 2016, vol. 171, issue P3, 371-380

Abstract: Extending the life-cycle of products has received ample attention in the field of reverse logistics, but research on the market acceptance of remanufactured products is still in its infancy, especially how they compare to used products. In this paper, we investigate how consumers perceive remanufactured products relative to used and new products. We construct a database containing 1716 eBay listings, and use that to investigate the factors that influence the differences in prices between used, remanufactured, and new iPods. Our results confirm that remanufactured products are sold at a discount relative to new products. New to the literature on reverse logistics are the following results. For all types of iPods we find evidence that remanufactured products command a premium over their used counterparts. Also, for two types of iPod, a positive description of the product increases the average price for used products relative to remanufactured ones, which suggests that consumers need less reassurance regarding the quality of remanufactured products than used ones. Furthermore, for the third type of iPod, and for all new and remanufactured products, we find no evidence that a positive description significantly affects price. We explain our findings through the lenses of information asymmetry and adverse selection. We also observed that price dispersion is higher for used than for remanufactured products, indicating that remanufacturing may homogenise the quality of products, or at least the way consumers perceive them. We conclude that consumer perception of remanufactured products relative to their used and new counterparts, and hence their willingness to pay, depends in subtle and not yet well-understood ways on the nature of the product.

Keywords: Remanufacturing; Sustainable supply chains; Reverse logistics; Willingness-to-pay; Information asymmetry (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (27)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0925527315000407
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:171:y:2016:i:p3:p:371-380

DOI: 10.1016/j.ijpe.2015.02.006

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 ().