Game Theory Applied in the Management of Electric and Electronic Equipment Waste in Brazil

Abstract

Economic and environmental crises appear to increasingly come from similar exogenous origins, such as market failures, and endogenous sources, such as poor management of scarce natural resources. Notably, the establishment of PNRS (National Policy of Solid Waste) in Brazil led to the development of reverse logistics (RL) practices for various economic sectors, particularly electrical and electronic equipment. This paper focuses on this question and presents a quantitative evaluation of possible economic results that could be obtained using Game Theory in a negotiation between electronic manufacturers and a cooperative of collectors/recyclers of waste electrical and electronic equipment (WEEE). This article shows that there is a possibility of eliminating market failures and improving the management of resources to obtain optimal WEEE management through the implementation of Economic Game Theory along with the Coase Theorem. The discussion highlights the importance of choosing WEEE management tools in Brazil, including criteria for potentially negotiating between economic agents associated with waste.