The resource conservation effect of recycling in a dynamic Leontief model

The aim of the paper is to investigate the impact of recycling on the use of non-renewable resources in the economy. The paper tries to generalize the classical dynamic input–output model. In this regard we extend the standard Leontief model with the balance equation of recycled products, and we establish some properties of this augmented model. We investigate how recycling extends the availability of non-renewable natural resources for the next generations in an inter-industry framework. Supposing a balanced growth both for production and consumption, we examine the existence of the balanced growth path of this model and compare the results to the classical Leontief model. We try to answer the question whether recycling/reuse increases the growth possibility of an economy. Finally, we illustrate our results with a simple numerical example. Thus, we analyze a possible sustainable development of the economy on the basis of the product recovery management of industries.

A production/recycling model with quality consideration

An integrated production–recycling system is investigated. A constant demand can be satisfied by production and recycling. The used items might be bought back and then recycled. The not recycled products are disposed off. Two types of models are analyzed. The first model examines and minimizes the EOQ related cost. The second model generalizes the first one by introducing additionally linear waste disposal, recycling, production and buyback costs. This basic model was examined by the authors in a previous paper. The main results are that a pure strategy (either production or recycling) is optimal. This paper extends the model for the case of quality consideration: it is asked for the quality of the bought back products. In the former model we have assumed that all returned items are serviceable. One can put the following question: Who should control the quality of the returned items? If the suppliers examine the quality of the reusable products, then the buyback rate is strongly smaller than one, α<1. If the user does it, then not all returned items are recyclable, i.e. the use rate is smaller than one, δ<1. Which one of the control systems are more cost advantageous in this case?