Sustainable product design under resource scarcity

The increasing scarcity of resource has raised sustainability awareness in recent years. In response, many manufacturers develop green co-products using materials that would be otherwise discarded to alleviate consumption of scarce resource. In this work, we apply game theoretic analysis to examine a monopolist manufacture´s product design problem when consumers are heterogeneous in valuing quality of a product and its resource consumption. We characterize how consumers´ rise in green awareness affects the monopolist´s profitability and resource consumption.