Recycling Model Selection for Electronic Products Considering Platform Power and Blockchain Empowerment

Abstract

This paper considers a dynamic platform-based, closed-loop supply chain consisting of a manufacturer and an online platform. As an online distributor of the manufacturer, the platform expands the market scale by exerting the platform power. At the same time, to solve the problem of inconsistency between the actual recycling amount and the theoretical recycling amount in the recycling process of waste electronic products, the whole-process supervision of waste products is carried out with the help of blockchain technology, which is difficult to tamper with and is traceable. With the help of differential game theory, four differential game models of manufacturer recycling and platform recycling with and without blockchain are established. The state feedback strategies are derived from Bellman’s continuous dynamic programming theory. Through analytical results and comparative analysis, the adoption conditions of blockchain and the impact of blockchain on the selection of recycling models are obtained. The results illustrated that the introduction of blockchain technology effectively improves the real recycling rate of waste electronics, building trust in consumers, which benefits corporations in certain conditions. However, it amplifies the double marginal effect of the CLSC. Nevertheless, the implementation of blockchain is still beneficial to consumers, as the adverse impact of the double marginal effect is compensated by the improvement in consumer surplus. In addition, the study shows that the implementation of the blockchain incentivizes members, who benefit on the same recycling model when the fixed cost of the blockchain and the share ratio of the residual value of waste electronics are between certain thresholds. That is, both the manufacturer and the platform are better off in a manufacturer recycling model enabled by blockchain. Moreover, in this model, the social welfare and the recycling rate of waste electronics are increased, which enable the CLSC to achieve benefits related to economy, environment, and society.