The impact of remanufacturing in the economy

Very few durable goods are recovered at the end of their useful lives. However, this situation could reverse with the development of a stronger remanufacturing industry in the economy. This paper evaluates the impact of remanufacturing in a hypothetical situation where remanufacturing holds a significant share of the economy, presently dominated by the original manufacturing industries. We adapt the inter-industry input-output framework with the development of a methodology to consider these changes. Subsequently, we apply the model to the 30-sector aggregation of the French input-output national data to illustrate the method and to evaluate the impact that remanufacturing may have on the economy. Remanufacturing sectors substitute labor and transport services for the usual inputs such as raw materials and semi-finished goods. We find that remanufacturing may satisfy the same final demand from all sectors requiring fewer intermediate resources. Consequently, the economy observes proportionally higher demand for labor and all other products. (C) 2000 Elsevier Science B.V. All rights reserved.