Abstract: In recent years, Waste Electrical and Electronic Equipment (WEEE) with significant environmental attribute, has attracted more and more attention of the public. The government has also emphasized the collection of WEEE with legislation to prevent pollution, such as the Extended Producer Responsibility (EPR). Despite of the laws and the efforts of the public, the environment still faces serious challenge. The government, further, has adopted several incentive mechanisms, such as subsidy, to encourage enterprises to collect WEEE.
Based on these incentive policies, the reward-penalty mechanism (RPM) is proposed to increase the collection rate. In the RPM, the government sets the reward-penalty intensity and target collection rate. The enterprise will receive reward (penalty, resp.) if the actual collection rate is higher (lower, resp.) than the target collection rate. In addition, given the difficulty of collecting WEEE, the collection responsibility-sharing has been investigated in this paper.
With the advance of the retail, the retailers, such as WAL-MART, SUNING, GOME and etc., play a more important role in the supply chain. Therefore, in this paper, a closed-loop supply chain (CLSC) model is developed, in which the retailer is a Stackelberg leader and the manufacturer and the third-party collector are followers. Then four cases are studied respectively:the government implements the RPM to manufacturer (Case M); the government implements RPM to the third-party collector (Case TP); the government implements RPM to manufacturer and retailer simultaneously (Case MR); the government implements RPM to manufacturer and the third-party collector simultaneously (Case MTP).
With the comparison and analysis of the equilibrium, the main results are showed as follows. (i) Under Case M, Case TP and Case MTP, the retail prices, the collection rates, the wholesale prices and the total profits of the CLSC are respectively equal. (ii) Compared with other three cases, Case MR results in lower collection rate, higher wholesale price and lower total profit of the CLSC, while the retail price under four cases keeps the same. (iii) If the government implements RPM only to the manufacturer (the collector, resp.), the manufacturer (the collector, resp.) will suffer a profit loss, while the collector (the manufacturer, resp.) will share ‘free riding’. (iv) When the government implements RPM to the manufacturer and the collector, all the players in the CLSC can benefit the RPM if the manufacturer undertakes more collection responsibility relatively.
Our paper extends and complements prior research that has only studied the CLSC with either the RPM or collection responsibility-sharing in the retailer-led setting.

Key words: retailer-led, CLSC, collection responsibility-sharing, RPM