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Corporate Social Responsibility and Environmentally Sound Technology in Endogenous Firm Growth

Author

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  • Angela C. Chao

    (School of Management and Economics, Southeast University, Nanjing 210096, China)

  • Zhengning Pu

    (School of Management and Economics, Southeast University, Nanjing 210096, China)

Abstract

We have entered the “New Normal” economy, with more emphasis on economic growth driven by innovation than resource. This paper investigates the impacts of firms considering corporate social responsibility and environmentally sound technology by building a three-stage Cournot competition model with asymmetric cost. The sustainable development of economic and endogenous firm growth achieves the win–win result in the theoretical model. Using data from 31 firms in China, this paper empirically researches on the relationships among corporate social responsibility, environmentally sound technology and firm endogenous growth. The results show that: (1) Marginal cost decreased with the increase of innovation, as well as getting government research and development subsidy, which has a positive effect on firm growth. (2) Consumers respond positively to corporate social responsibility initiative, the reputation of the firm can be improved. At the same time, environmentally sound technology objectively reduces the marginal cost of competitors because of the technology spillover. (3) Profit of a firm undertaking corporate social responsibility partly decreases, which has a negative effect on firm growth. The contradiction between corporate social responsibility and profit of firm could be adjusted, such as socially responsible investment fund hosed by institutional investors.

Suggested Citation

  • Angela C. Chao & Zhengning Pu, 2017. "Corporate Social Responsibility and Environmentally Sound Technology in Endogenous Firm Growth," Sustainability, MDPI, vol. 9(2), pages 1-13, February.
    • Handle: RePEc:gam:jsusta:v:9:y:2017:i:2:p:234-:d:89846
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    References listed on IDEAS

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    Cited by:

    1. Qinghua Zhu & Fei Zou & Pan Zhang, 2019. "The role of innovation for performance improvement through corporate social responsibility practices among small and medium‐sized suppliers in China," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 26(2), pages 341-350, March.
    2. Ionela Munteanu & Adriana Grigorescu & Elena Condrea & Elena Pelinescu, 2020. "Convergent Insights for Sustainable Development and Ethical Cohesion: An Empirical Study on Corporate Governance in Romanian Public Entities," Sustainability, MDPI, vol. 12(7), pages 1-17, April.
    3. Chao, Angela C. & Hong, Lucheng, 2019. "Corporate Social Responsibility Strategy, Environment and Energy Policy," Structural Change and Economic Dynamics, Elsevier, vol. 51(C), pages 311-317.
    4. Radosław Wolniak & Adam Wyszomirski & Marcin Olkiewicz & Anna Olkiewicz, 2021. "Environmental Corporate Social Responsibility Activities in Heating Industry—Case Study," Energies, MDPI, vol. 14(7), pages 1-19, March.
    5. Lucheng Hong & Angela Chao, 2018. "Strategic Corporate Social Responsibility, Sustainable Growth, and Energy Policy in China," Energies, MDPI, vol. 11(11), pages 1-13, November.
    6. Chege, Samwel Macharia & Wang, Daoping, 2020. "The influence of technology innovation on SME performance through environmental sustainability practices in Kenya," Technology in Society, Elsevier, vol. 60(C).

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