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Subsidies, Environmental Taxes, and Rare Earth Recycling: A Game-Theoretical Analysis of Reverse Supply Chain Equilibrium
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DOI：10.3390/su18168281.png)
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Abstract
En 中文
Rare earths are a strategically vital mineral resource on a global scale; the security of their supply chain and their recycling face severe challenges amid dual pressures of resource scarcity and environmental protection. This study focuses on the reverse supply chain for rare earth permanent magnet materials—specifically those based on praseodymium and neodymium—constructing a two-level game model comprising a rare earth oligopoly (Stackelberg leader) and two recyclers (Cournot followers). It systematically analyzes the dual decision-making behavior of recyclers between “recycling and selling” and “in-house remanufacturing”, and examines the impact of two policy instruments—government subsidies and environmental taxes—on the supply chain equilibrium. The study employs reverse induction to solve the game equilibrium and combines this with numerical simulation methods to compare the differing effects of the two policies on key indicators such as product output, market share, profit distribution, waste recovery volume, and recycling rates. The results indicate that there is strategic coordination and resource competition in recyclers’ decisions regarding recycling and remanufacturing, causing them to assume dual roles as both “suppliers” and “competitors” within the supply chain. Subsidy policies significantly incentivize recycling and remanufacturing activities, thereby increasing the recycling rate, but exert a slight squeeze on the profits of rare earth conglomerates. Environmental tax policies effectively curb primary mining and promote resource circulation, but may have a negative impact on the remanufacturing industry. Currently, value within the closed-loop rare earth supply chain is highly concentrated among upstream oligopolistic enterprises, whilst the recycling segment suffers from insufficient economic incentives and significant policy dependency. This study provides theoretical support and decision-making references for the government to optimize policy combinations and promote the high-quality development of the rare earth recycling industry.
Keywords:
rare earth resource recycling
government subsidies
environmental taxes
game theory
Journal
IF:
3.3
Papers:
10.5W
Citations:
28.4W
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Cited Papers