Social responsibility in a bilateral monopoly with R&D
Mariel Leal and
Sang-Ho Lee ()
MPRA Paper from University Library of Munich, Germany
This note examines social responsibility in a linear bilateral monopoly by incorporating a cost-reducing R&D investment and investigates an endogenous timing game. We find that in the presence of R&D, the retailer always adopts social responsibility irrespective of the timing of the game, but the manufacturer adopts only with its leadership in a sequential game where it can take the first-mover advantage. We also show that two sequential choices will be subgame perfect equilibria, but the commitment to the social responsibility by manufacturer is a payoff dominance outcome.
Keywords: social responsibility; R&D investment; fixed-timing game; endogenous-timing game (search for similar items in EconPapers)
JEL-codes: D21 L13 L22 M14 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-com, nep-gth and nep-ind
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https://mpra.ub.uni-muenchen.de/87200/1/MPRA_paper_87200.pdf original version (application/pdf)
https://mpra.ub.uni-muenchen.de/92228/1/MPRA_paper_87200.pdf revised version (application/pdf)
https://mpra.ub.uni-muenchen.de/92228/9/MPRA_paper_92228.pdf revised version (application/pdf)
Journal Article: Social responsibility in a bilateral monopoly with R&D (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:87200
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