Eco-Firms and the Sequential Adoption of Environmental Corporate Social Responsibility in the Managerial Delegation

Sang-Ho Lee and Chul-Hi Park ()

The B.E. Journal of Theoretical Economics, 2019, vol. 19, issue 1, 9

Abstract: This article investigates the strategic environmental corporate social responsibility (ECSR) of polluting firms in the presence of eco-firms. When the firms decide to adopt ECSR sequentially within the framework of the managerial incentive design and then face simultaneous price competition, we show that firms will adopt ECSR and purchase abatement goods to mitigate competition if the products are more substitutable, but the late adopter chooses lower ECSR and thus earns higher profit. It can partially explain the current expansive adoption of ECSR as an industry-wide wave.

Keywords: environmental corporate social responsibility; eco-firms; abatement goods; late adopter advantage (search for similar items in EconPapers)
JEL-codes: L13 L21 M14 (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (50)

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Working Paper: Eco-Firms and Sequential Adoption of Environmental Corporate Social Responsibility in the Managerial Delegation (2017)
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DOI: 10.1515/bejte-2017-0043

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