arXiv 15 Feb 2026 · Econometrics
arXiv:2602.14288 · PDF · DOI · OpenAlex · Extracted main text
In many consumer electronics and appliance markets, manufacturers sell products through competing retailers while simultaneously relying on take-back programs to recover used items for remanufacturing. Designing such programs is challenging when firms compete on prices and consumers differ in their willingness to return products. Motivated by these settings, this paper develops a game theoretic framework to analyze pricing and take-back decisions in a dual-channel closed loop supply chain (CLSC) with two competing manufacturers and two competing retailers. Manufacturers act as Stackelberg leaders, simultaneously determining wholesale prices and consumer take-back bonuses, while retailers engage in Nash competition over retail prices. The model integrates three key elements: (i) segmented linear demand with cross-price effects, (ii) deterministic product returns, and (iii) an inertia responsiveness allocation mechanism governing the distribution of returned products between manufacturers. Closed form Nash equilibria are derived for the retailer subgame, along with symmetric Stackelberg equilibria for manufacturers. We derive a feasibility threshold for take-back incentives, identifying conditions under which firms optimally offer positive bonuses to consumers. The results further demonstrate that higher remanufacturing value or return rates lead the manufacturers to lower wholesale prices in order to expand sales and capture additional return volumes, while high consumer inertia weakens incentives for active collection. Numerical experiments illustrate and reinforce the analytical results, highlighting how consumer behavior, market structure and product substitutability influence prices, bonuses, and return volumes. Overall, the study provides managerial insights for designing effective take-back programs and coordinating pricing decisions in competitive circular supply chains.
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The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.
| Reference | Intensity | Mentions | Sections | Main text | |
|---|---|---|---|---|---|
| 1 | Wadhwa, G. and Walunj, T. S. and Kavitha, V (2024) Partition-Form Cooperative Games in Two-Echelon Supply Chains self | 0.874 | 6 | 2 | 100% |
| 2 | Fleischmann, M. and Bloemhof-Ruwaard, J. M. and Dekker, R. and van d… (2001) Quantitative Models for Reverse Logistics: A Review | 0.737 | 3 | 2 | 100% |
| 3 | Guide, V. D. R. and Van Wassenhove, L. N (2009) The Evolution of Closed-Loop Supply Chain Research | 0.737 | 3 | 2 | 100% |
| 4 | Mukhopadhyay, S. K. and Setoputro, R (2018) Consumer Return Behavior and Product Reuse in Closed-Loop Supply Chains | 0.737 | 3 | 2 | 100% |
| 5 | Savaskan, R. C. and Van Wassenhove, L. N (2003) Closed-Loop Supply Chain Models with Product Remanufacturing | 0.737 | 3 | 2 | 100% |
| 6 | Shulman, J. D. and Coughlan, A. T (2011) Consumer Returns Policies and Supply Chain Performance | 0.737 | 3 | 2 | 100% |
| 7 | Debo, L. G. and Toktay, L. B. and Van Wassenhove, L. N (2005) Competing to Acquire Used Products: Buyback vs. Trade-in vs. Rebate | 0.585 | 3 | 1 | 100% |
| 8 | Atasu, A. and Sarvary, M. and Van Wassenhove, L. N (2008) Remanufacturing as a Marketing Strategy | 0.511 | 2 | 1 | 100% |
| 9 | Cachon, G. P. and Lariviere, M. A (2005) Supply Chain Coordination with Revenue-Sharing Contracts: Strengths and Limitations | 0.511 | 2 | 1 | 100% |
| 10 | Giri, B. C. and Bardhan, S (2021) Game Theoretic Models in Reverse and Closed-Loop Supply Chain: A Review | 0.511 | 2 | 1 | 100% |
Showing the top 10 of 19 scored citations.