Recycling Models of Waste Electrical and Electronic Equipment under Market-Driven Deposit-Refund System: A Stackelberg Game Analysis

Yi Liu, Weihua Liu and Chunsheng Li ()
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Yi Liu: School of Business, Macau University of Science and Technology, Macao 999078, China
Weihua Liu: School of Business, Macau University of Science and Technology, Macao 999078, China
Chunsheng Li: School of Business, Macau University of Science and Technology, Macao 999078, China

Mathematics, 2024, vol. 12, issue 14, 1-19

Abstract: Recycling waste electrical and electronic equipment (WEEE) has garnered considerable societal attention. To incentivize WEEE recycling within a closed-loop supply chain (CLSC), a deposit-refund system (DRS) has been implemented. This study delves into the implications of a market-driven DRS on WEEE recycling under different recycling models. A Stackelberg game analysis is employed, where an electronics manufacturer (leader) has sufficient channel power over an electronics retailer and a third-party recycler (followers). The results indicate that the market-driven DRS significantly incentivizes consumer recycling efforts, ultimately elevating the economic efficiency of the supply chain. When the electronics manufacturer assumes responsibility for WEEE recycling, it streamlines the recycling process, thereby enhancing operational efficiency and profitability. Conversely, when the electronics retailer handles WEEE recycling, it reduces retail prices and simplifies the recycling process, positively influencing consumer purchasing behavior. However, when a third-party recycler undertakes WEEE recycling, the recycling volume tends to be minimal, resulting in the lowest level of supply chain profits. This paper provides theoretical and practical implications for improving the recycling effectiveness and operational efficiency of the CLSC.

Keywords: closed-loop supply chain; market-driven deposit-refund system; WEEE recycling; recycling models (search for similar items in EconPapers)
JEL-codes: C (search for similar items in EconPapers)
Date: 2024
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