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The optimal level of corporate social responsibility based on the duopoly model

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  • Junlong Chen
  • Chaoqun Sun
  • Jiali Liu
  • Yan Huo

Abstract

This paper constructs a duopoly model considering corporate social responsibility (CSR) and market's sensitivity to CSR (e) and analyzes the equilibrium results, the condition of CSR implementation and the optimal CSR level (β*) of Model CC (two enterprises implement CSR) and Model CN (only one enterprise implements CSR). The results show that β* is affected by competitors and e. e, marginal cost (c) and cost difference affect the equilibrium results and the comparative results. Reducing c and improving e can promote social welfare. Consumer surplus under Model CC is highest. CSR has a negative effect on social welfare under certain conditions.

Suggested Citation

  • Junlong Chen & Chaoqun Sun & Jiali Liu & Yan Huo, 2021. "The optimal level of corporate social responsibility based on the duopoly model," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 42(1), pages 177-184, January.
    • Handle: RePEc:wly:mgtdec:v:42:y:2021:i:1:p:177-184
    DOI: 10.1002/mde.3222
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    4. Junlong Chen & Chaoqun Sun & Jiali Liu, 2022. "Corporate social responsibility, consumer sensitivity, and overcapacity," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(2), pages 544-554, March.

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