Watchdogs of the Invisible Hand: NGO monitoring and industry equilibrium

Gani Aldashev, Michela Limardi and Thierry Verdier

Journal of Development Economics, 2015, vol. 116, issue C, 28-42

Abstract: Globalization has been accompanied by rising pressure from advocacy non-governmental organizations (NGOs) on multinational firms to act in socially-responsible manner. We analyze how NGO pressure interacts with industry structure, using a simple model of NGO-firm interaction embedded in an industry environment with endogenous markups and entry. We explain three key empirical patterns in developing-country industries under activist pressure: the degree of exit under more intense activist pressure, the differential response of industries to NGO activism, and the general rise of NGO activism following globalization.

Keywords: NGOs; Globalization; Private regulation; Monopolistic competition (search for similar items in EconPapers)
JEL-codes: D43 L13 L31 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (22)

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Related works:
Working Paper: Watchdogs of the Invisible Hand: NGO monitoring and industry equilibrium (2015)
Working Paper: Watchdogs of the Invisible Hand: NGO monitoring and industry equilibrium (2015)
Working Paper: Watchdogs of the Invisible Hand: NGO monitoring and industry equilibrium (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:deveco:v:116:y:2015:i:c:p:28-42

DOI: 10.1016/j.jdeveco.2015.03.006

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