GOVERNMENT INTERVENTION IN A RECYCLING SUPPLY CHAIN SYSTEM: A STRATEGY TO MAKE SUSTAINABLE AND CLEAN ENVIRONMENT

Abstract

Rapid industrialization and huge production over the whole world are diminishing natural resources as well as increasing the harmful impacts on the environment. Now, it is imperative to address the harmful impacts and develop a circular economy in each production system. The paper investigates Govt. intervention in a recycling supply chain system of a manufacturer, a re-manufacturer, and two retailers. Here, consumers’ demand is measured from the utility function based on the product’s initial valuation, price, and greening level. The Govt. controls carbon emissions, environmental burden, and revenue by imposing different policies. The entire problem is classified into six scenarios based on different Govt. policies and supply chain (SC) members’ cooperation and non-cooperation. The scenarios are modeled between Govt. and SC members and a bi-level interactive non-linear optimization problem is formulated. Finally, a numerical experiment is performed and sensitivity analyses of various parameters are conducted. The result pursues that the environmental burden is reduced when the Govt takes two initiatives: imposing a tax on the new products and providing a subsidy to the re-manufacturer. Also, the SC with members’ cooperation emits the least carbon emissions while non-cooperation gives the highest revenue to the Govt. and makes a sustainable environment.