Government subsidies to reverse supply chains can play important roles in driving or curtailing the flows of recycled items. We examine the impacts of exogenous subsidies on recycled material flows in a decentralized reverse supply chain where each participant acts according to its own interests. We outline a multitiered model of the supply network from sources of scrap electronics, collectors, processors and demand markets. The individual behavior of each player is governed by participants’ optimality conditions, which are mathematically transformed into a variational inequality formulation. The modified projection method is utilized for solving the equilibrium quantities and prices of each participant. We investigate the impact of alternate schemes of government subsidies on decisions of the equilibrium quantities, prices and the total amount collected. For the case studied in this study, the best tier selection between collectors and processors for government subsidies in terms of the overall recycling performance is located in processors in laptop computer reverse supply chains.