Fairness Concern in Remanufacturing Supply Chain-A Comparative Analysis of Channel Members' Fairness Preferences

Remanufacturing is a sustainable product reutilization strategy to realize responsible consumption and production. However, it has remained a largely untapped opportunity for enhancing productivity due to some behavioral matters such as fairness concerns of remanufacturing related firms. Concerning the emerging and development of remanufacturing industry, this paper provides a game-theoretic analysis for a remanufacturing supply chain (RSC) consisting of one leading manufacturer and a following retailer, with the inclusion of fairness concern. We propose and compare several scenarios of channel members' fairness preferences as, both members are fairness concerned, only one member is fairness concerned, and both members are fair neutral, to expound how fairness concern affects RSC strategies and resulting utilities. We also demonstrate dynamic evolution and stable state of channel members' selections of whether being fairness concerned in the long term. Analytical results show that favorable scenarios for the RSC to achieve desired objective are relevant to its preference for improved supply chain performance or enhanced environmental benefit. Whatever the preference is, however, it is detrimental for both members to be fairness concerned in the short term. In the long term, evolutionary stable strategies of fairness concerns indicate that both members or only one member would choose to be fairness concerned. The eventual status relies on the initial state of fairness preference. The results are especially relevant as a reference for remanufacturing related strategies, thus enhancing production sustainability as well as environmental benefits.

Automated summary

This paper provides a game-theoretic analysis of the impact of fairness concern on a remanufacturing supply chain. Different scenarios of fairness preferences among channel members are compared, and the results show that the achievement of desired objectives by the RSC depends on its preference for supply chain performance or environmental benefit. It is found that both members being fairness concerned is detrimental in the short term, but in the long term, the evolutionary stable strategies suggest that both members or only one member would choose to be fairness concerned. These results have significant implications for remanufacturing strategies, enhancing production sustainability and environmental benefits.