Impact of government subsidy on the remanufacturing industry regarding technology cooperation

Abstract

<p style='text-indent:20px;'>Under the environmental concerns of consumers, this study uses game theory to analyze the impact of government subsidies on remanufacturing and environmental protection. The original equipment manufacturer (OEM) and the independent remanufacturer (IR) can select cooperation and non-cooperation, which are facilitated by government subsidies, in two ways, including technology licensing and R & D joint-venture. We design a market where consumers care about the environment, involving the government, an OEM and an IR. The study finds that the quality level of products and the proportion of technology transfer are important factors influencing cooperation strategies. If the government wants to develop high-quality remanufactured products to make up for the lack of new products, it should increase remanufacturing subsidies to help remanufacturers obtain technology. If the government wants to reduce environmental pollution through the development of remanufacturing, the level of technology transfer of remanufactured products that can be mass-produced is generally not high.We compare the profit and environmental performance of the three strategies under the government subsidy policy and find that when the government subsidy is moderate, we can realize the triple win of enterprise and environment.</p>