When Is Social Responsibility Socially Desirable?

Jean-Etienne de Bettignies and David Robinson

Journal of Labor Economics, 2018, vol. 36, issue 4, 1023 - 1072

Abstract: We study a model in which corporate social responsibility arises in response to inefficient regulation. In our model, firms, governments, and workers interact. Firms create negative spillovers that can be attenuated through government regulation, which is set endogenously and may not be socially optimal. Companies can hire socially responsible employees who enjoy correcting spillovers. Because firms can capture rents created by allowing this, they sometimes find it optimal to lobby for inefficient rules and then encourage socially responsible behavior in their midst. Thus, social responsibility can either increase or decrease social welfare, depending on the costs of political capture.

Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

Downloads: (external link)
http://dx.doi.org/10.1086/697476 (application/pdf)
http://dx.doi.org/10.1086/697476 (text/html)
Access to the online full text or PDF requires a subscription.

Related works:
Working Paper: When Is Social Responsibility Socially Desirable? (2015)
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:ucp:jlabec:doi:10.1086/697476

Access Statistics for this article

More articles in Journal of Labor Economics from University of Chicago Press
Bibliographic data for series maintained by Journals Division ().