Quotation Rabta, Boualem. 2020. An Economic Order Quantity inventory model for a product with a circular economy indicator. Computers and Industrial Engineering. 140 1-9.




Circular economy approach is receiving an increasing attention as an alternative to the current linear economic model with the ambition of positive impact on the environment while contributing to economic growth. In this paper, an Economic Order Quantity inventory model in a circular economy is presented. We assume that the product can be manufactured with a variable level of circularity measured by an index. The information provided by a given circularity indicator allows the consumers to make responsible decisions about what they buy. Governments can influence the transition to a circular economy through regulations, taxes and subsidies, while companies seek to maximize their profits by taking these considerations into account in decision-making. Hence, we argue that the circularity level has impact on the demand, cost and selling price of the product and propose various linear and nonlinear relationships. Therefore, additionally to the order quantity, the circularity level is also a decision variable in our model. The optimal parameters are determined analytically and numerical Examples are provided. From the company’s perspective, the obtained results demonstrate that making circular products can be justified financially.


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Publication's profile

Status of publication Published
Affiliation WU
Type of publication Journal article
Journal Computers and Industrial Engineering
Citation Index SCI
WU-Journal-Rating new INF-A, STRAT-B, WH-B
Language English
Title An Economic Order Quantity inventory model for a product with a circular economy indicator
Volume 140
Year 2020
Page from 1
Page to 9
Reviewed? Y
URL https://doi.org/10.1016/j.cie.2019.106215
DOI https://doi.org/10.1016/j.cie.2019.106215
Open Access N


Rabta, Boualem (Details)
Institute for Production Management (Reiner) (Details)
Research areas (ÖSTAT Classification 'Statistik Austria')
1121 Operations research (Details)
5326 Production research (Details)
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