Modelling the trade-off between profits and principles

Johan Graafland

MPRA Paper from University Library of Munich, Germany

Abstract: Corporations discover that social responsibility pays off. However, sometimes doing what is ethical will prove costly to a company. The purpose of this article is to clarify this trade-off by developing an economic model that describes the choice between profits and principles. The model is used to analyse how external factors like a change in consumer interests and competitiveness affect the relationship between profits and principles.

Keywords: Corporate social responsibility; ethics; competitiveness; profit maximisation; reputation; win-win (search for similar items in EconPapers)
JEL-codes: D21 D69 M14 (search for similar items in EconPapers)
Date: 2002
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Citations: View citations in EconPapers (9)

Published in De Economist 150.2(2002): pp. 129-154

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:20752

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