CSR, rationality and the ethical preferences of investors in a laboratory experiment
AbstractThis experimental study aims to clarify to what extent and in which direction investors react to CSR (Corporate Social Responsibility) initiatives meant to upgrade the ethical standards of firms beyond the minimal requirements of law. Subjects in the laboratory were invited to invest their endowment in a portfolio of financial assets. We provided information on the expected returns of each stock and on its inclusion in an ethical index, or exclusion from it. Our findings show that subjects' behavior appears to be a function not only of their individual pay-offs but also of the information on the ethical standards of the firms issuing stocks. Most of them, however, did not show a fully irrational behavior as they consistently correlated the share of stocks with their expected returns. We may conclude that the sizeable reaction of our investors to the inclusion of a stock in the ethical index, or its exclusion from it, is the fruit of a deliberate choice.
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Bibliographic InfoArticle provided by Elsevier in its journal Research in Economics.
Volume (Year): 63 (2009)
Issue (Month): 4 (December)
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Web page: http://www.elsevier.com/locate/inca/622941
Ethical stock indexes CSR (Corporate Social Responsibility) Investors Experiment;
Other versions of this item:
- Costanza Consolandi & Alessandro Innocenti & Alessandro Vercelli, 2009. "CSR, rationality and the ethical preferences of investors in a laboratory experiment," Department of Economic Policy, Finance and Development (DEPFID) University of Siena 0609, Department of Economic Policy, Finance and Development (DEPFID), University of Siena.
- G30 - Financial Economics - - Corporate Finance and Governance - - - General
- M14 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
- Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
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Department of Economic Policy, Finance and Development (DEPFID) University of Siena
0208, Department of Economic Policy, Finance and Development (DEPFID), University of Siena.
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