Corporate social responsibility and privatization policy in a mixed oligopoly

Seung-Leul Kim (), Sang-Ho Lee and Toshihiro Matsumura
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Seung-Leul Kim: Wonkwang University

Journal of Economics, 2019, vol. 128, issue 1, No 4, 67-89

Abstract: Abstract This article formulates a mixed oligopoly in which a public firm competes with two private firms that may adopt corporate social responsibility (CSR). We then determine the optimal privatization policy and find that, depending on CSR level and cost differences among firms, either nationalization or full privatization can be optimal. For identical cost functions, we also show the optimal degree of privatization is decreasing with the level of CSR if private firms are homogeneous, while it is non-monotone with the CSR level in a significant heterogeneity of objectives among the firms. Our analysis suggests that CSR activities that affect the magnitude of heterogeneity among firms are crucial in choosing an optimal privatization policy in a mixed oligopoly.

Keywords: Corporate social responsibility; Mixed oligopoly; Partial privatization; Nationalization; Full privatization (search for similar items in EconPapers)
JEL-codes: D45 H23 L13 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (71)

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Working Paper: Corporate social responsibility and privatization policy in a mixed oligopoly (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:kap:jeczfn:v:128:y:2019:i:1:d:10.1007_s00712-018-00651-7

DOI: 10.1007/s00712-018-00651-7

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