Extended Producer Responsibility (EPR) legislation focuses on the life‐cycle environmental performance of products and has significant implications for management theory and practice. In this paper, we examine the influence of EPR policy parameters on product design and coordination incentives in a durable product supply chain. We model a manufacturer supplying a remanufacturable product to a customer over multiple periods. The manufacturer invests in two design attributes of the product that impact costs incurred by the supply chain—performance, which affects the environmental impact of the product during use, and remanufacturability, which affects the environmental impact post‐use. Consistent with the goals of EPR policies, the manufacturer and the customer are required to share the environmental costs incurred over the product's life cycle. The customer has a continuing need for the services of the product and optimizes between the costs of product replacement and the costs incurred during use. We demonstrate how charges during use and post‐use can be used as levers to encourage environmentally favorable product design. We analyze the impact of supply chain coordination on design choices and profit and discuss contracts that can be used to achieve coordination, both under symmetric and asymmetric information about customer attributes.

We characterize the trade‐offs among firms' compliance strategies in a market‐based program where a regulator interested in controlling emissions from a given set of sources auctions off a fixed number of emissions permits. We model a three‐stage game in which firms invest in emissions abatement, participate in a share auction for permits, and produce output. We develop a methodology for a profit‐maximizing firm to derive its marginal value function for permits and translate this value function into an optimal bidding strategy in the auction. We analyze two end‐product market scenarios independent demands and Cournot competition. In both scenarios we find that changing the number of available permits influences abatement to a lesser extent in a dirty industry than in a cleaner one. In addition, abatement levels taper off with increasing industry dirtiness levels. In the presence of competition, firms in a relatively clean industry can, in fact, benefit from a reduction in the number of available permits. Our findings are robust to changes in certain modeling assumptions.

Internationalization theories from economics and international business disciplines suggest that products are launched, and production facilities established, sequentially in industrialized, newly industrialized, and finally, in developing countries. From a firm level perspective, operations management researchers have proposed descriptive models of generic roles of international factories. But little has appeared in the economics, international business, or operations management literature that compares these two views or provides much empirical evidence to support divergent claims. In this paper, we compare both perspectives and shed insight into factory roles through a detailed examination of data on plant practices and performance in the global picture tube industry. Our analysis suggests that existing theory and descriptive models do not possess enough explanatory power to adequately predict or describe the dynamics of product and production loci today. We highlight the need for a new theory by contrasting today's global business realities with those of yesteryears.

Recent environmental trends, including (1) an expansion of existing command and control directives, (2) the introduction of market-based policy instruments, and (3) the adoption of extended producer responsibility, have created a need for new tools to help managerial decision-making. To address this need, we develop a nonlinear mathematical programming model from a profit-maximizing firm's perspective, which can be tailored as a decision-support tool for firms facing environmental goals and constraints. We typify our approach using the specific context of diesel engine manufacturing and remanufacturing. Our model constructs are based on detailed interviews with top managers from two leading competitors in the medium and heavy-duty diesel engine industry. The approach allows the incorporation of traditional operationsplanning considerations-in particular, capacity, production, and inventory-together with environmental considerations that range from product design through production to product end of life. A current hurdle to implementing such a model is the availability of input data. We therefore highlight the need not only to involve all departments within businesses but also for industrial ecologists and business managers to work together to implement meaningful decision models that are based on accurate and timely data and can have positive economic and environmental impact.

This paper studies organizational change following a shift in an industry

Internationalization theories from economics and international business disciplines suggest that products are launched, and production facilities established, sequentially in industrialized, newly industrialized, and finally, in developing countries. From a firm level perspective, operations management researchers have proposed descriptive models of generic roles of international factories. But little has appeared in the economics, international business, or operations management literature that compares these two views or provides much empirical evidence to support divergent claims. In this paper, we compare both perspectives and shed insight into factory roles through a detailed examination of data on plant practices and performance in the global picture tube industry. Our analysis suggests that existing theory and descriptive models do not possess enough explanatory power to adequately predict or describe the dynamics of product and production loci today. We highlight the need for a new theory by contrasting today's global business realities with those of yesteryears.