Full participation of closed-loop supply chain considering secondary market with portfolio government environmental regulation

This paper focuses on the context of the growing global environmental consensus, where the secondary market of green supply chains has developed rapidly and closed-loop supply chains have become a core carrier of the circular economy, rendering government environmental regulations increasingly critical. Existing studies mostly concentrate on single carbon policies, neglecting the combined effects of multiple policies and the full participation of all supply chain members, which creates a research gap. We assume a closed-loop supply chain involving original equipment manufacturers, retailers, and independent remanufacturers with a secondary market, and design a portfolio of government environmental regulations integrating carbon cap-and-trade, emission control penalty, and carbon compensation subsidy policies. Using variational inequality theory, two network equilibrium models (with and without government environmental regulation) are constructed and solved via the modified projection method, complemented by numerical analyses across naive, competitive original equipment manufacturer, and universal scenarios. The findings suggest that government environmental regulations effectively reduce carbon emissions and are generally beneficial to society, though improper implementation may harm some participants; excessive subsidies are detrimental to non-retailers, carbon trading prices exert a more significant impact than penalties, and increased consumer green awareness boosts secondary market participation. It is concluded that governments should adopt flexible carbon trading caps with stringent emission control levels, implement reasonable subsidies, coordinate carbon market dynamics with penalty policies, and that retailers should strengthen green marketing to promote market transfer, thereby advancing closed-loop supply chain sustainability.