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Impacts of carbon trading mechanism on closed-loop supply chain: A case study of stringer pallet remanufacturing

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  • Liao, Haolan
  • Wu, Di
  • Wang, Yuhan
  • Lyu, Zeyu
  • Sun, Hongmei
  • Nie, Yongyou
  • He, He

Abstract

Remanufacture unlocks the residual values in used products by prolonging the life cycles, whereas the inherent uncertainty in reverse logistics presents a significant challenge for operations management and brings resources into waste. To reduce the negative externality caused by uncertainty in reverse logistics, this study makes stochastic analysis of the market uncertainty and formulates an ordering strategy for environmental sustainability to minimize the carbon emissions. Further, considering the externality of environmental pollution can be internalized into the operating cost by carbon trading mechanism, we then investigate the economic behavior under the fluctuation of carbon price. Through polynomial regression, the model forecasts the carbon price in Beijing carbon trading center and quantifies the impacts of price variation on the decision process, then from which devises a balanced and sustainable EOQ strategy to optimize the economic efficiency at lower resource input. Through empirical examples that carried out with different forecasting methods, the results testify the validity and robustness of the model.

Suggested Citation

  • Liao, Haolan & Wu, Di & Wang, Yuhan & Lyu, Zeyu & Sun, Hongmei & Nie, Yongyou & He, He, 2022. "Impacts of carbon trading mechanism on closed-loop supply chain: A case study of stringer pallet remanufacturing," Socio-Economic Planning Sciences, Elsevier, vol. 81(C).
    • Handle: RePEc:eee:soceps:v:81:y:2022:i:c:s0038012121002019
    DOI: 10.1016/j.seps.2021.101209
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