The Impact of Internal Whistleblowing on Product Quality Regulation: A Tripartite Evolutionary Game Analysis

Lu Chen, Yan Guo, Ning Wang and Zheyun Zhao

Emerging Markets Finance and Trade, 2025, vol. 61, issue 2, 289-306

Abstract: Existing research suggests that government regulation and firm self-discipline are the primary factors in achieving effective product quality regulation. Building on previous research, this study examines the role of employees as participants in quality regulation. We construct a tripartite evolutionary game model involving employees, government, and firms to analyze the impact of employee whistleblowing on product quality regulation. The results indicate that the effectiveness of employee whistleblowing in monitoring enterprises and governments is influenced by government accountability, the severity of administrative penalties, and media exposure. We further analyze two channels of influence of whistleblowing incentives on government and firm behavior. Finally, the impact of whistleblowing on governments and firms is examined and confirmed through case analyses of typical quality incidents in emerging markets, including the Changsheng vaccine incident in China and the Ranbaxy quality incident in India. Our study fills a research gap by constructing an evolutionary game model to analyze the impact of employee whistleblowing incentives on government and firm behavior, supported by case studies from emerging markets, and provides theoretical insights for policymakers in designing effective participation mechanisms that combine rewards, protection, accountability, media coverage, and administrative sanctions.

Date: 2025
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DOI: 10.1080/1540496X.2024.2380074

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