R&D innovation with socially responsible firms

Domenico Buccella, Luciano Fanti and Luca Gori ()

Discussion Papers from Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy

Abstract: This work revisits the R&D model à la D’Aspremont –Jacquemin (1988) (AJ) in a context with socially responsible firms. In the traditional model firms invest but, in equilibrium, they are cast into a prisoner’s dilemma. Socially responsible firms also invest in equilibrium. However, provided that firms consider sufficiently high consumer welfare, to invest is firms’ utility-enhancing: the prisoner’s dilemma vanishes, and the R&D investment is the firms’ Pareto-efficient choice. That is, while in the traditional AJ context to invest in R&D is Pareto-inferior for the whole society, when firms are of CSR type their R&D innovation becomes a Pareto-superior choice.

Keywords: Process innovation; Corporate social reponsibility; Nash equilibrium; Social welfare (search for similar items in EconPapers)
JEL-codes: D43 L13 O31 (search for similar items in EconPapers)
Date: 2021-11-01
New Economics Papers: this item is included in nep-com, nep-cse, nep-gth, nep-ino, nep-mic, nep-sbm and nep-upt
Note: ISSN 2039-1854
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.ec.unipi.it/documents/Ricerca/papers/2021-282.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pie:dsedps:2021/282

Access Statistics for this paper

More papers in Discussion Papers from Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy Contact information at EDIRC.
Bibliographic data for series maintained by ().