Impacts of Government Replacement Subsidy on Differential Pricing Closed-Loop Supply Chain

Abstract

The government replacement subsidy promotes the sales of remanufacturing products and recycling of obsolete products, and then makes significant impacts on differential pricing closed-loop supply chain. This paper discusses the effects of the government replacement subsidy on the decision-making of four different differential pricing closed-loop supply chain models, and analyzes its impacts on the profits of closed-loop supply chain system and its members. The research shows that, the reasonable government replacement subsidy can effective achieve the goal of the policy and some stakeholders will benefit from it, including the replacement consumers, closed-loop supply chain system and its participants, environmental benefits, while others will damaged from it.