A Digital Tool for Analyzing Effects from Regulatory Policies on Environmental Impacts in Supply-Chains

It is paramount for the circular economy that the supply of products, components and materials match the demand for effective re-use and re-manufacturing. In this paper, we present a tool for balancing fairness and environmental impact (e.g., from transport) in trading goods subject to demand-supply matching (DSM) for circularity. The tool addresses the problem of controlling this balance when multiple demanders buy goods from multiple suppliers, which may implement a volume-dependent price model. In such cases, identifying the best possible set of procurements to obtain a desired balance demands a model that provides a predictable output from declarative statements on this balance. We evaluate our tool using simulations to demonstrate its usefulness in evaluating the effects on fairness between trading actors from regulatory policies related to environmental impact. We show that our DSM ranking tool can be used to evaluate such effects using simulations of different market scenarios. Based on these results, we discuss extensions of the model for it to support additional such statements in more complex DSM scenarios that for example also include seller reputation as a matching criterion.