Abstract
This study considers a monopolist remanufacturing enterprise under both mandatory carbon emission capacity and take-back regulations. We explore the optimal decisions of the remanufacturer and investigate the impacts of regulations on both the economy and environment. Using stylized models, we study four scenarios (i.e., with and without take-back and carbon emission capacity regulations). We first analyze how should the remanufacturer adjust operational decisions to maximize profit. We then explore both the economic and environmental implications of regulations. Our analysis reveals: (1) Carbon regulation is not only an effective way to reduce carbon emissions but can also stimulate remanufacturing. (2) For the enterprise, both take-back and carbon emission capacity regulations lead to lower profit, and we provide guidance for the enterprise to make production and pricing adjustments. (3) For the government, carbon cap is an effective measure to reduce the environmental impact; however, when setting the remanufacturing target, it is critical to evaluate the environmental impact during disposal phase.
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