A note on ‘Corporate Social Responsibility and Marketing Channel Coordination’
AbstractGoering (2012) works on a bilateral monopoly with perfect marketing channel coordination to analyze the effects of corporate social responsibility. He starts the analysis of a bilateral monopoly with socially concerned firms where either the manufacturer or the retailer is additionally to its profit interested in a share of consumer surplus. In this short note, we extend this analysis and study the case where both firms are socially concerned. As a result, we enlarge the analysis started by Goering (2012) and get further interesting insights into a bilateral monopoly with corporate social responsibility. First, we are able to summarize ‘Proposition 1’ and ‘Proposition 4’ into a common one and figure out the circumstances when the wholesale price fixed by the manufacturer is below marginal costs. Second, we explain analytically the findings from ‘Proposition 3’ and ‘Proposition 6’. We point out the model's key assumption – the perfectly coordinated marketing channel – as the driver of the results and the reason for the equilibrium results' independence from retailer's social concern.
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Bibliographic InfoArticle provided by Elsevier in its journal Research in Economics.
Volume (Year): 67 (2013)
Issue (Month): 4 ()
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Web page: http://www.elsevier.com/locate/inca/622941
Bilateral monopoly; Channel coordination; Socially concerned firm;
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- Kopel, Michael & Brand, Björn, 2012. "Socially responsible firms and endogenous choice of strategic incentives," Economic Modelling, Elsevier, vol. 29(3), pages 982-989.
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- Goering, Gregory E., 2012. "Corporate social responsibility and marketing channel coordination," Research in Economics, Elsevier, vol. 66(2), pages 142-148.
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