Optimal Operation for Green Supply Chain in Consideration of Collection Incentive and Quality for Recycling of Used Products

Mean-Variance Analysis for Optimal Operation and Supply Chain Coordination in a Green Supply Chain

“…To discuss the risk attitude, this paper applies the classical mean-variance (MV) theory (Markowitz, 1959;Choi et al, 2008b) to determining the optimal operations of GSC members and the whole system in the GSC under the uncertainty in product demand. This paper is closely relevant to Watanabe et al (2013) and Watanabe and Kusukawa (2014). The system framework of a GSC which is considered in this paper is the same as that in Watanabe et al (2013) and Watanabe and Kusukawa (2014).…”

“…This paper is closely relevant to Watanabe et al (2013) and Watanabe and Kusukawa (2014). The system framework of a GSC which is considered in this paper is the same as that in Watanabe et al (2013) and Watanabe and Kusukawa (2014). The GSC consists of a retailer and a manufacturer, and it is assumed that a contract for cooperation regarding collection of used products is concluded between both members.…”

“…Using the mean-variance analysis for each risk attitude, the theoretically optimal decisions for product order quantity, collection incentive, and lower limit of quality level, in the decentralized GSC (DGSC) and the integrated GSC (IGSC) are made. DGSC optimizes the utility function of each member, based on the Stackelberg game (Nagarajan and Sosic, 2008;Yan and Sun, 2012, Watanabe et al, 2013, Watanabe and Kusukawa, 2014, Hong et al, 2015. IGSC optimizes that of the whole system.…”

“…Therefore, supply chain coordination is introduced into IGSC to encourage both members to shift the optimal operations as to risk attitude of GSC members from those in DGSC, by guaranteeing the both members' expected profits improvement in IGSC. Concretely, the unit wholesale price and compensation for collection incentive of used products are coordinated between members as to risk attitudes in IGSC as Nash bargaining solution (Nash, 1950(Nash, , 1953Kohli Park, 1989, Nagarajan andSosic, 2008;Hong et al, 2013;Watanabe et al, 2013;Watanabe and Kusukawa, 2014;Ghosh and Shah, 2015).…”

Analyzing the Evolutionary Stability for Behavior Strategies in Reverse Supply Chain

“…The traditional forward chains/logistics construct the flows from procurement of new materials through production of new products to sell them. The reverse chains/logistics are composed of the flows from collection of used products through recycling parts from the used products to reuse the recycled parts (Aras et al, 2004;Behret and Korugan, 2009;Ferguson et al, 2009;Fleischman et al, 1997;Guide and Wassenhove, 2001;Inderfurth, 2005;Konstantaras et al, 2010;Mukhopadhyay and Ma, 2009;Nenes et al, 2010;Pokharel and Liang, 2012;Teunter and Flapper, 2011;Wei et al, 2011;Wu, 2012, Watanabe et al, 2013, Watanabe and Kusukawa, 2014. Also, a supply chain which organizes the forward chains and the reverse chains has been called as a closed-supply chain, a reverse supply chain or a green supply chain (Bakal and Akcali, 2006;Barari et al, 2012, Fleischman et al, 1997Guide et al, 2003;Inderfurth, 2005;Kaya, 2010;Lee et al, 2011;Shi et al, 2010Shi et al, , 2011Tagaras and Zikopoulos, 2008;Thierry et al, 1995;Van Wassenhove and Zikopoulos, 2010;Watanabe et al, 2013, Watanabe and Kusukawa, 2014, Wei et al, 2012Yan and Sun, 2012;Tagaras, 2007, 2008).…”