Dynamic decisions in a closed-loop supply chain with two competitive third-party recyclers under altruistic preference

Abstract

The closed-loop supply chain (CLSC) consisting of a manufacturer, a retailer, and two competing third-party recyclers with altruistic preference is focused by us. We separately consider three altruistic preference models of differential game and Bellman theory that contrast and analyse dynamic decision-making such as the wholesale price of electric vehicle batteries (batteries) and the design innovation investment on the quality level decisions of the manufacturer, the unit selling price decision of the retailer, the recycling rate decisions of two third-party recyclers and the quality level of batteries. The numerical simulation further explores the rule of the time evolution of CLSC performance under four models. From our research, we conclude that: the altruistic preference has an optimistic impact in normal circumstances; if both the manufacturer and the retailer have altruistic preferences, the benefit of the value function of CLSC revealed only when the competition is at a lower level; the competition between two third-party recyclers is disadvantageous to the value function of CLSC, consumers and recycling activity.