Abstract: Taken product remanufacturing closed-loop supply chain included a manufacturer, a retailer and two third party recyclers as the background, a closed-loop supply chain decision model was built by using the loss-averse function, cournot model and government subsidy excitation function. The effect of risk characteristics, government subsidy and cournot competition on supply chain was analyzed, and the impact of revenue-and-expense sharing contract was analyzed in the channel, which showed the contract could eliminate the double marginalization and risk aversion effect, and hence the loss-averse closed loop supply chain could achieve coordination. Finally, by the analysis of numerical simulation based on revenue-and-expense sharing contract, the validity and practicability of the model is verified, and the relationship between government subsidy, risk characteristics, competitive characteristics with the supply chain is obtained. This study can provide decision support and decision-making reference for the development of remanufacturing industry.

Key words: loss-averse, government subsidy, cournot competition, revenue-and-expense sharing contract