Dynamics analysis on competition between manufacturing and remanufacturing in context of government subsidies

In this paper, a two-period game model involving an original manufacturer, a remanufacturer and a retailer was built in context of government subsidies. The system can be regarded as a coupling dynamic of the forward supply chain of Stackelberg game model. Based on this game model, the impact of three government subsidy scenarios (the government subsidizes no one; the government subsidizes remanufacturers; and the government subsidizes the consumers through retailers) on the unit wholesale price, retail price and profit of the two kinds of products is analyzed. Based on the analysis, some dynamic phenomena such as bifurcation and chaos are found. Numerical simulations and the largest Lyapunov exponent are used to provide experimental evidence for the complicated behaviors of the system evolution. The results show that the government subsidy for remanufacturers can reduce the retail price of remanufactured products, increase the retailer's profit, and improve the market competitiveness of remanufactured products, but it makes a small difference to the remanufacturers' profit; and the government subsidy for consumers has a significant impact on the market competitiveness of remanufactured products.