Incentive Mechanism and Subsidy Design for Construction and Demolition Waste Recycling under Information Asymmetry with Reciprocal Behaviors.

To solve information asymmetry, we adopted the principal-agent framework to design the incentive mechanisms between the remanufacturer and the collector in the construction and demolition (C&D) waste-recycling industry. By using the model of reciprocity, we analyzed how the entities' behavioral motives affect their decisions in terms of the incentive mechanisms. The findings showed that the collector responds to their perception of the remanufacturer's intentions. If the perception is positive, they will make more effort in the collection work. If not, less effort will be put forth. Most importantly, we found that reciprocity helps to save the remanufacturer cost in the incentive mechanisms and makes the collector choose a higher effort level in the collection work. This finding showed that reciprocity serves to solve information asymmetry. By conducting a numerical simulation, we found that although a high subsidy policy can achieve rapid improvement of recycling-supply-chain performance, it is inefficient in maintaining friendly cooperation between the remanufacturer and the collector.

Pricing Strategy of Construction and Demolition Waste Considering Retailer Fairness Concerns under a Governmental Regulation Environment.

In order to investigate the issues of the recycling and remanufacturing of construction and demolition waste (C&D waste), this paper develops a closed-loop supply chain (CLSC) consisting of a manufacturer, a retailer, and a recycler, considering both the retailer's fairness concern psychology and governmental regulations. Four mathematical models are developed for the calculations, and the models are solved through game theory. In both the decentralized and centralized scenarios, the members' strategies are discussed and the optimal values of decision variables are determined. A numerical study is carried out for sensitivity analyses to verify the accuracy of the theoretical conclusions. The results reveal that retailer fairness concerns lead to a decrease in the wholesale price of building materials and negatively affect manufacturers' profits. Additionally, governmental regulations can effectively increase the recycling amount and improve the utilization rate of C&D waste, and promote a virtuous cycle of the recycling and remanufacturing of C&D waste.