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Corporate social responsibility in unionised network industries

Author

Listed:
  • Luciano Fanti

    (University of Pisa)

  • Domenico Buccella

    (Kozminski University)

Abstract

In a duopoly network industry with decentralised union wage setting, this paper studies the impact of the firms’ engagement in consumer-friendly corporate social responsibility (CSR) on profitability and welfare. It is shown that, regardless of whether the wage setting occurs prior to or after the choice of the CSR levels, being a CSR-type firm rather than a simple profit-maximiser can lead to larger profits and thus higher welfare for their owners/stakeholders. However, the welfare analysis reveals that there is always conflict of interest between the firms’ owners on the one side and consumers, unions, and society on the other side, with respect for the timing of the decision about CSR relative to that of the wage setting.

Suggested Citation

  • Luciano Fanti & Domenico Buccella, 2021. "Corporate social responsibility in unionised network industries," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 68(2), pages 235-262, June.
    • Handle: RePEc:spr:inrvec:v:68:y:2021:i:2:d:10.1007_s12232-021-00366-0
    DOI: 10.1007/s12232-021-00366-0
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    Cited by:

    1. Domenico Buccella & Luciano Fanti & Luca Gori, 2021. "R&D innovation with socially responsible firms," Discussion Papers 2021/282, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    2. Samreen Hamid & Asif Saeed & Umar Farooq & Faisal Alnori, 2022. "A Bibliometric Retrospection of CSR from the Lens of Finance and Economics: Towards Sustainable Development," Sustainability, MDPI, vol. 14(24), pages 1-25, December.

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    More about this item

    Keywords

    Cournot duopoly; Network industry; Labour union; Corporate social responsibility;
    All these keywords.

    JEL classification:

    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility

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