Research on Decision-Making of Low-Carbon and Closed-Loop Supply Chain Recovery Model Considering Government Subsidies

Abstract

Considering the low-carbon and closed-loop supply chain composed of manufacturers and retailers, this paper constructs four game models in which manufacturers non-participate/participate in cooperative recovery under government subsidies. They analyze the impact of government subsidies on wholesale price, retail price, recovery rate and member profit under different recovery situations, and solve the optimal recovery decision and government subsidy decision. The research shows that: (1) the recovery rate is negatively correlated with the wholesale price, and positively correlated with government subsidies, consumers' low-carbon preference and low-carbon level. (2) Government subsidies play a positive role in the recovery decision-making of closed-loop supply chain members. When the government provides the same subsidy price to the recovery subject, manufacturers prefer to entrust retailers for recovery, and manufacturers' participation in cooperative recovery mode is conducive to improving the product recovery rate of closed-loop supply chain. (3) When the government subsidized price is lower, the manufacturer's task sharing and cooperative recovery is more beneficial to its own recovery rate and profit; On the contrary, cost sharing and cooperative recovery are more beneficial to their own recovery rate and profits.