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Han, Y.;  Zheng, H.;  Huang, Y.;  Li, X. Construction and Demolition Waste Recycling Supply Chain. Encyclopedia. Available online: https://encyclopedia.pub/entry/24540 (accessed on 04 July 2024).
Han Y,  Zheng H,  Huang Y,  Li X. Construction and Demolition Waste Recycling Supply Chain. Encyclopedia. Available at: https://encyclopedia.pub/entry/24540. Accessed July 04, 2024.
Han, Yating, Haoxuan Zheng, Yicheng Huang, Xingwei Li. "Construction and Demolition Waste Recycling Supply Chain" Encyclopedia, https://encyclopedia.pub/entry/24540 (accessed July 04, 2024).
Han, Y.,  Zheng, H.,  Huang, Y., & Li, X. (2022, June 28). Construction and Demolition Waste Recycling Supply Chain. In Encyclopedia. https://encyclopedia.pub/entry/24540
Han, Yating, et al. "Construction and Demolition Waste Recycling Supply Chain." Encyclopedia. Web. 28 June, 2022.
Construction and Demolition Waste Recycling Supply Chain
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This entry is adapted from the peer-reviewed paper 10.3390/buildings12060832

An increasing amount of construction and demolition waste (CDW) is generated in the demolition, retrofitting, and new construction of buildings and municipal infrastructure projects. Engineering construction units, as CDW producers, often follow the principle of prioritizing interests, and will accumulate garbage and send it to landfills.

consumer green preference government subsidies closed-loop supply chain for construction and demolition waste (CDW)

1. Introduction

As a result of the rapid development of the world economy and the rising living standards of the global population, urbanization and industrialization are accelerating. An increasing amount of construction and demolition waste (CDW) is generated in the demolition, retrofitting, and new construction of buildings and municipal infrastructure projects [1][2][3][4]. Statistics show that more than 10 billion tons of CDW are generated every year, of which about 700 million tons are generated in the United States [5], more than 800 million tons are generated in the European Union [6], and about 230 million tons are generated in China [7].
Engineering construction units, as CDW producers, often follow the principle of prioritizing interests, and will accumulate garbage and send it to landfills. If these wastes are not properly disposed of, they will wreak havoc on the environment, adversely affect arable land, and threaten people’s physical and mental health. Therefore, determining how to balance economic development and environmental protection is particularly important, and the effective implementation of CDW management has become a priority action item for the global sustainable development goals [8].
In terms of technology, many materials in CDW can be reused as renewable resources after being sorted, shredded, or removed. For example, CDW can be used as an eco-friendly alternative in the production of eco-efficient cement [9]. In terms of management, construction materials are wasted due to a lack of basic technical and labor knowledge, poor material handling, poor material quality, and other reasons. This wastage can be prevented by strict and regular monitoring of workers, accurate estimation of material quantities, and proper storage [10]. In addition, the European Union, Japan, the United States, etc. have promulgated relevant laws and regulations, ordering manufacturers to be responsible for the entire life cycle of products, and requiring them to recycle and dispose of their products. In addition, an increasing number of enterprises have implemented closed-loop supply chain management [11].
Various issues related to CDW management have also attracted extensive attention from the academic community. The “3Rs” principle has long been proposed in Western countries, and studies have shown that “reducing, reusing, and recycling” of CDW is a hierarchical and well-planned planning strategy [12][13][14]. Several scholars have also reviewed methods that can quantify CDW generation [15][16]. These studies have promoted the development of CDW management and proposed new directions for subsequent topics. At present, in the research on the supply chain of CDW resource utilization, scholars often believe that consumer demand is only related to the product price, and the green degree of the product has not yet been considered. Based on this, the pricing of green new products and green remanufactured products has become a key decision for supply chain enterprises.
The continuous deterioration in the global ecological environment has awakened people’s awareness of environmental protection. Due to the enhancement of consumers’ awareness of environmental protection, environmentally friendly products are increasingly favored by consumers [17]. In order to better adapt to the needs of consumers, enterprises in the closed-loop supply chain have gradually shifted from the traditional extensive management model to the consumer-centered intensive management model. This intensive management model can meet the needs of green consumers and maximize corporate profits. However, most enterprises believe that, the greener the product, the better the product meets the needs of consumers, and the higher the profit they will receive. However, this will eventually result in the price of green products exceeding consumer expectations, causing manufacturers to use green materials to produce products that will not be able to be sold. This hurts profits of both manufacturers and retailers. In addition, because their product demand is affected by consumers’ green preferences, manufacturers have to invest in the research and development of green products to improve their competitiveness [18][19]. However, the implementation of green technology innovation inevitably increases the production cost of enterprises; as a result, some enterprises may be reluctant to develop green technology [20]. Based on this, many scholars have conducted research and found that the government can adjust the subsidy rate and supervision probability, which can control the distribution mode of corporate profits, and thereby affect the decision-making behavior of stakeholders in the supply chain [21][22][23]. Therefore, major global economies have successively issued a series of laws, regulations, and subsidy policies in order to promote the green production of enterprises and achieve sustainable development. For example, the United States enacted the Solid Waste Disposal Act as early as 1965 [24], becoming the first country to legally determine waste utilization. In 2021, China proposed that, during the “14th Five-Year Plan” period, it will thoroughly implement relevant laws and regulations, vigorously promote waste reduction, resource utilization, and the harmless disposal of bulk solid waste, and promote the comprehensive utilization of the resources industry to achieve new development [25].

2. CDW Management

In order to alleviate the negative impact of CDW on the environment and promote the stable development of the CDW recycling industry, the scientific management and effective utilization of CDW has become the focus of extensive attention of experts and scholars. Regarding CDW recycling research, some scholars noted, from a technical point of view, that the vast majority of CDW can be converted into new building materials through proper recycling treatment, thereby contributing to the sustainability of the construction industry [26]. Using the technical feasibility of CDW recycling as a guarantee, some scholars have found from a management perspective that the attitudes and behaviors of CDW management stakeholders, and economic incentives, have a significant impact on CDW management [27][28][29]. To promote the better formation and operation of the CDW resource utilization supply chain, there is an urgent need to study CDW management from the perspective of supply chain operation, to clarify the decision-making process of stakeholders in the supply chain [30]. Therefore, some scholars have constructed evolutionary game models and found that business leaders, the government supervision rate, the government cost subsidy rate, and the recycling unit’s effort profit coefficient will affect the decision-making behavior of recycling units and CDW remanufacturers [31]. Other scholars have found, by solving the Stackelberg model, that factors such as the learning effect, reference effect, information sharing, and fairness concerns, can affect the decision making and profit of the CDW resource utilization supply chain [32][33][34].
The above research proves that it is important to closely study CDW management by constructing a game model. The existing research mainly involves the different decision making of supply chain members, such as the government, construction waste recyclers, recyclers, and retailers, but has not fully considered the behavior of consumers in the supply chain. Based on this, from the perspective of consumer behavior, this research examined how consumers’ green preferences and government subsidies affect the decisions of manufacturers and retailers in the CDW resource utilization supply chain. In addition, this research examined the decision making of the CDW resource utilization supply chain when both new products and remanufactured products have a green degree.

3. Consumer Behavior Theory

Consumer behavior theory shows that consumers’ purchasing decisions are not only closely related to the product itself, but are also influenced by consumer preferences [35]. In reality, consumers’ purchasing decision behavior is often affected by a variety of factors, and different consumers have different consumption preferences for various factors. Studies have found that, as a result of the increasingly serious problem of environmental pollution, consumers are more willing to buy low-carbon, energy-saving, and environmentally friendly products. This behavior will change the product attributes of producers, prompt manufacturers to enhance their green innovation capabilities to produce green products, and promote the development of green industries [36][37]. Therefore, the green preferences of consumers have attracted great attention from the government and enterprises. Some scholars believe that the profits of retailers and manufacturers in the supply chain are related to consumers’ green preferences. For example, Xu et al. [38] found that the product environmental protection level, recycling rate, and corporate profits at each node were positively correlated with consumers’ green preferences, but negatively correlated with the green investment coefficient. Abbey et al. [39] empirically found that green consumers, and consumers who perceived remanufactured products as green, generally found remanufactured products to be more attractive.
The above research results suggest that consumers’ green preferences have an impact on the pricing decisions of stakeholders in the supply chain and the green degree of products. However, most studies on consumers’ green preferences focus on green manufacturers and do not consider the impact on green remanufacturers’ decision making. Moreover, consumer green preferences have not been considered in the CDW resource utilization supply chain. Therefore, further research on consumers’ preferences for green products based on consumer behavior theory will play an important role in the development of CDW resource utilization supply chain.

4. Closed-Loop Supply Chain under Government Subsidies

The government, as a supervisor and regulator, plays a leading role in the process of recycling CDW [40]. Questionnaires have found that government subsidies can effectively stimulate the recycling of CDW [41][42]. In recent years, a large amount of research has examined closed-loop supply chain management under government subsidy policies.
First, research on subsidizing green products has shown that, when the government subsidizes the manufacturer, the increase in the government subsidy will improve the green degree of the product, but the government subsidy is not always beneficial to the green supply chain and the manufacturer [43]. In addition, scholars have studied how governments use consumer subsidies to promote the development of green technologies, and how policy adjustments interact with industrial production decisions over time [44].
Second, the research on subsidized remanufactured products generally shows that government subsidies effectively stimulate the demand for remanufactured products and promote the development of the remanufacturing industry [45][46]. For example, Huang [47] et al. studied the impact of government subsidies on channel members’ pricing decisions and recycling mode choices, and found that government subsidies have a positive effect on remanufacturers’ and collectors’ willingness to remanufacture.
Aware of the importance of consumers’ green preferences and government subsidies, some scholars have considered the impact of supply chain members’ related decisions and profits under the combined effect of the two. For example, Barman et al. [48] explored pricing strategies, green strategies, and compared optimal decision making for both centralized and decentralized models. Yu et al. [49] found that the improvement in consumers’ environmental awareness and good government subsidy policies will motivate manufacturers to produce more green products and generate profits for manufacturers. However, whether these conclusions can be obtained in the construction waste resource utilization supply chain remains to be confirmed.
To summarize, there are still some deficiencies in the research on the supply chain of CDW resource utilization. First, few scholars have integrated the product’s green degree into the closed-loop supply chain of CDW. Second, no scholars have considered both government subsidies and consumer green preferences in the construction waste resource utilization supply chain. In view of this, in this research, Stackelberg game theory was used to solve for and compare the optimal pricing and revenue of building materials manufacturers and retailers under decentralized and centralized decision making, taking the product green degree, consumers’ green preferences, government subsidies, and other factors into consideration.

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Subjects: Environmental Studies; Construction & Building Technology
Contributors MDPI registered users' name will be linked to their SciProfiles pages. To register with us, please refer to https://encyclopedia.pub/register :
Yating Han
,
Haoxuan Zheng
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Yicheng Huang
,
Xingwei Li
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Update Date: 28 Jun 2022
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