IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/25255.html
   My bibliography  Save this paper

Environmental-Regulation Pricing Strategies for Green Supply Chain Management

Author

Listed:
  • Chen, Yenming
  • Sheu, Jiuh-Biing

Abstract

This paper demonstrates that a proper design of environmental-regulation pricing strategies is able to promote Extended Product Responsibility for green supply chain firms in a competitive market. A differential game model comprising Vidale-Wolfe equation has been established in light of sales competition and recycling dynamics as well as regulation related profit function. Analytic solutions of Markovian Nash equilibriums are provided with the necessary condition derived from Hamilton-Jacobi-Bellman equations. We found that governments should opt to gradually raise regulation standards so that rational manufacturers will gradually improve its product recyclability, and, in turn, Extended Product Responsibility will get promoted.

Suggested Citation

  • Chen, Yenming & Sheu, Jiuh-Biing, 2007. "Environmental-Regulation Pricing Strategies for Green Supply Chain Management," MPRA Paper 25255, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:25255
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/25255/1/MPRA_paper_25255.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Don Fullerton & Wenbo Wu, 2002. "Policies for Green Design," Chapters, in: Don Fullerton & Thomas C. Kinnaman (ed.), The Economics of Household Garbage and Recycling Behavior, chapter 5, pages 102-119, Edward Elgar Publishing.
    2. A. Prasad & S. P. Sethi, 2004. "Competitive Advertising Under Uncertainty: A Stochastic Differential Game Approach," Journal of Optimization Theory and Applications, Springer, vol. 123(1), pages 163-185, October.
    3. Adam B. Jaffe et al., 1995. "Environmental Regulation and the Competitiveness of U.S. Manufacturing: What Does the Evidence Tell Us?," Journal of Economic Literature, American Economic Association, vol. 33(1), pages 132-163, March.
    4. Duchin, Faye & Lange, Glenn-Marie, 1995. "The Future of the Environment: Ecological Economics and Technological Change," OUP Catalogue, Oxford University Press, number 9780195085747.
    5. Palmer, Karen L. & Walls, Margaret, 1999. "Extended Product Responsibility: An Economic Assessment of Alternative Policies," Discussion Papers 10830, Resources for the Future.
    6. Mukhopadhyay, Samar K. & Setaputra, Robert, 2007. "A dynamic model for optimal design quality and return policies," European Journal of Operational Research, Elsevier, vol. 180(3), pages 1144-1154, August.
    7. Sheu, Jiuh-Biing & Chou, Yi-Hwa & Hu, Chun-Chia, 2005. "An integrated logistics operational model for green-supply chain management," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 41(4), pages 287-313, July.
    8. Walls, Margaret, 2003. "The Role of Economics in Extended Producer Responsibility: Making Policy Choices and Setting Policy Goals," RFF Working Paper Series dp-03-11, Resources for the Future.
    9. Stavins, Robert N., 2003. "Experience with market-based environmental policy instruments," Handbook of Environmental Economics, in: K. G. Mäler & J. R. Vincent (ed.), Handbook of Environmental Economics, edition 1, volume 1, chapter 9, pages 355-435, Elsevier.
    10. Chongwoo Choe & Iain Fraser, 2001. "On the Flexibility of Optimal Policies for Green Design," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 18(4), pages 367-371, April.
    11. Kriwet, A. & Zussman, E. & Seliger, G., 1995. "Systematic integration of design-for-recycling into product design," International Journal of Production Economics, Elsevier, vol. 38(1), pages 15-22, March.
    12. Foulon, Jerome & Lanoie, Paul & Laplante, Benoit, 2002. "Incentives for Pollution Control: Regulation or Information?," Journal of Environmental Economics and Management, Elsevier, vol. 44(1), pages 169-187, July.
    13. Dockner,Engelbert J. & Jorgensen,Steffen & Long,Ngo Van & Sorger,Gerhard, 2000. "Differential Games in Economics and Management Science," Cambridge Books, Cambridge University Press, number 9780521637329, January.
    14. Vogelsang, Ingo, 2002. "Incentive Regulation and Competition in Public Utility Markets: A 20-Year Perspective," Journal of Regulatory Economics, Springer, vol. 22(1), pages 5-27, July.
    15. Palmer, Karen & Walls, Margaret, 1997. "Optimal policies for solid waste disposal Taxes, subsidies, and standards," Journal of Public Economics, Elsevier, vol. 65(2), pages 193-205, August.
    16. Carter, Craig R. & Jennings, Marianne M., 2002. "Social responsibility and supply chain relationships," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 38(1), pages 37-52, January.
    17. Ekins, Paul, 1999. "European environmental taxes and charges: recent experience, issues and trends," Ecological Economics, Elsevier, vol. 31(1), pages 39-62, October.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Asuncion Arner Guerre, 2022. "The Extended Producer Responsibility for Waste Oils," International Journal of Energy Economics and Policy, Econjournals, vol. 12(2), pages 210-217, March.
    2. Luyi Gui & Atalay Atasu & Özlem Ergun & L. Beril Toktay, 2016. "Efficient Implementation of Collective Extended Producer Responsibility Legislation," Management Science, INFORMS, vol. 62(4), pages 1098-1123, April.
    3. Thomas C. Kinnaman & Don Fullerton, 2002. "The Economics of Residential Solid Waste Management," Chapters, in: Don Fullerton & Thomas C. Kinnaman (ed.), The Economics of Household Garbage and Recycling Behavior, chapter 1, pages 1-48, Edward Elgar Publishing.
    4. Söderholm, Patrik, 2011. "Taxing virgin natural resources: Lessons from aggregates taxation in Europe," Resources, Conservation & Recycling, Elsevier, vol. 55(11), pages 911-922.
    5. Özdemir, Öznur & Denizel, Meltem & Guide, V. Daniel R., 2012. "Recovery decisions of a producer in a legislative disposal fee environment," European Journal of Operational Research, Elsevier, vol. 216(2), pages 293-300.
    6. Frank Convery & Simon McDonnell & Susana Ferreira, 2007. "The most popular tax in Europe? Lessons from the Irish plastic bags levy," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 38(1), pages 1-11, September.
    7. Matthew Gunter, 2007. "Do Economists Reach a Conclusion on Household and Municipal Recycling?," Econ Journal Watch, Econ Journal Watch, vol. 4(1), pages 83-111, January.
    8. Calcott, Paul & Walls, Margaret, 2005. "Waste, recycling, and "Design for Environment": Roles for markets and policy instruments," Resource and Energy Economics, Elsevier, vol. 27(4), pages 287-305, November.
    9. Loukil, Faten & Rouached, Lamia, 2012. "Modeling packaging waste policy instruments and recycling in the MENA region," Resources, Conservation & Recycling, Elsevier, vol. 69(C), pages 141-152.
    10. Lambertini, Luca, 2021. "Regulating the tragedy of commons: Nonlinear feedback solutions of a differential game with a dual interpretation," Energy Economics, Elsevier, vol. 100(C).
    11. Brian Chi-ang Lin & Siqi Zheng & Ankinée Kirakozian, 2016. "One Without The Other? Behavioural And Incentive Policies For Household Waste Management," Journal of Economic Surveys, Wiley Blackwell, vol. 30(3), pages 526-551, July.
    12. Hage, Olle, 2007. "The Swedish producer responsibility for paper packaging: An effective waste management policy?," Resources, Conservation & Recycling, Elsevier, vol. 51(2), pages 314-344.
    13. Gunasekaran, Angappa & Spalanzani, Alain, 2012. "Sustainability of manufacturing and services: Investigations for research and applications," International Journal of Production Economics, Elsevier, vol. 140(1), pages 35-47.
    14. Patrik Söderholm & Tomas Ekvall, 2020. "Metal markets and recycling policies: impacts and challenges," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 33(1), pages 257-272, July.
    15. Don Fullerton & Andrew Leicester & Stephen Smith, 2008. "Environmental Taxes," NBER Working Papers 14197, National Bureau of Economic Research, Inc.
    16. Francisco J. André & Emilio Cerdá, 2005. "Gestión de residuos sólidos urbanos: Análisis económico y políticas públicas," Economic Working Papers at Centro de Estudios Andaluces E2005/23, Centro de Estudios Andaluces.
    17. Massarutto, Antonio, 2014. "The long and winding road to resource efficiency – An interdisciplinary perspective on extended producer responsibility," Resources, Conservation & Recycling, Elsevier, vol. 85(C), pages 11-21.
    18. Stavins, Robert, 2001. "Lessons From the American Experiment With Market-Based Environmental Policies," RFF Working Paper Series dp-01-53, Resources for the Future.
    19. Gerhard Sorger, 2005. "A dynamic common property resource problem with amenity value and extraction costs," International Journal of Economic Theory, The International Society for Economic Theory, vol. 1(1), pages 3-19, March.
    20. Numata, Daisuke, 2009. "Economic analysis of deposit–refund systems with measures for mitigating negative impacts on suppliers," Resources, Conservation & Recycling, Elsevier, vol. 53(4), pages 199-207.

    More about this item

    Keywords

    WEEE; E-waste; Incentive Mechanism; Competitive Market; Extended Production Responsibility; Differential Game; Optimal Control;
    All these keywords.

    JEL classification:

    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:25255. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.