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Private Politics

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  • Baron, David P.

    (Stanford U)

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    Abstract

    This paper introduces the subject of private politics and presents illustrative models using as the context a conflict between an activist and a firm. Private politics addresses situations of conflict and the resolution of that conflict without reliance on the law. It encompasses the political competition over entitlements in the status quo, the direct competition for support from the public, bargaining over the resolution of the conflict, and the maintenance of the agreed-to private order. The term private means that the parties do not rely on public order; i.e., law-making or the courts. The term politics refers to individual and collective action in situations in which individuals attempt to further their interests by imposing their will on others. The paper presents four models of private politics: 1) informational competition between an activist and a firm for support from the public, 2) decision by individual citizen consumers regarding the magnitude and timing of a boycott, 3) bargaining between the activist and the firm to resolve the boycott, and 4) the choice of private ordering to govern the ongoing conflict between the two parties.

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    Bibliographic Info

    Paper provided by Stanford University, Graduate School of Business in its series Research Papers with number 1689.

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    Date of creation: May 2001
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    Handle: RePEc:ecl:stabus:1689

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    1. Dilip Abreu & Faruk Gul, 2000. "Bargaining and Reputation," Econometrica, Econometric Society, Econometric Society, vol. 68(1), pages 85-118, January.
    2. David Kreps & Robert Wilson, 1999. "Reputation and Imperfect Information," Levine's Working Paper Archive 238, David K. Levine.
    3. Gul, Faruk & Lundholm, Russell, 1995. "Endogenous Timing and the Clustering of Agents' Decisions," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 103(5), pages 1039-66, October.
    4. Timothy J. Feddersen & Thomas W. Gilligan, 2001. "Saints and Markets: Activists and the Supply of Credence Goods," Journal of Economics & Management Strategy, Wiley Blackwell, Wiley Blackwell, vol. 10(1), pages 149-171, 03.
    5. Gul, Faruk & Sonnenschein, Hugo & Wilson, Robert, 1986. "Foundations of dynamic monopoly and the coase conjecture," Journal of Economic Theory, Elsevier, Elsevier, vol. 39(1), pages 155-190, June.
    6. David P. Baron, 2001. "Private Politics, Corporate Social Responsibility, and Integrated Strategy," Journal of Economics & Management Strategy, Wiley Blackwell, Wiley Blackwell, vol. 10(1), pages 7-45, 03.
    7. Milgrom, Paul & Roberts, John, 1982. "Predation, reputation, and entry deterrence," Journal of Economic Theory, Elsevier, Elsevier, vol. 27(2), pages 280-312, August.
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    Cited by:
    1. David Detomasi, 2008. "The Political Roots of Corporate Social Responsibility," Journal of Business Ethics, Springer, Springer, vol. 82(4), pages 807-819, November.
    2. Catherine J. Morrison-Paul & Donald S. Siegel, 2006. "Corporate Social Responsibility and Economic Performance," Rensselaer Working Papers in Economics, Rensselaer Polytechnic Institute, Department of Economics 0605, Rensselaer Polytechnic Institute, Department of Economics.
    3. Ian Worthington, 2009. "Corporate Perceptions of the Business Case for Supplier Diversity: How Socially Responsible Purchasing can ‘Pay’," Journal of Business Ethics, Springer, Springer, vol. 90(1), pages 47-60, November.
    4. Gregory E. Goering, 2010. "Corporate social responsibility, durable-goods and firm profitability," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 31(7), pages 489-496.
    5. Abdoul Sam, 2010. "Impact of government-sponsored pollution prevention practices on environmental compliance and enforcement: evidence from a sample of US manufacturing facilities," Journal of Regulatory Economics, Springer, Springer, vol. 37(3), pages 266-286, June.
    6. Catherine Liston-Heyes & Gwen Ceton, 2009. "An Investigation of Real Versus Perceived CSP in S&P-500 Firms," Journal of Business Ethics, Springer, Springer, vol. 89(2), pages 283-296, October.
    7. Yu-Chiang Hu & Chia-Ching Fatima Wang, 2009. "Collectivism, Corporate Social Responsibility, and Resource Advantages in Retailing," Journal of Business Ethics, Springer, Springer, vol. 86(1), pages 1-13, April.
    8. Enrique Bigné Alcañiz & Alejandro Alvarado Herrera & Rafael Currás Pérez, 2009. "Epistemological evolution of corporate social responsibility in marketing," International Review on Public and Nonprofit Marketing, Springer, Springer, vol. 6(1), pages 35-50, June.
    9. Abagail McWilliams & Donald S. Siegel & Patrick M. Wright, 2005. "Corporate Social Responsibility: Strategic Implications," Rensselaer Working Papers in Economics, Rensselaer Polytechnic Institute, Department of Economics 0506, Rensselaer Polytechnic Institute, Department of Economics.
    10. Chieh-Peng Lin & Nyan-Myau Lyau & Yuan-Hui Tsai & Wen-Yung Chen & Chou-Kang Chiu, 2010. "Modeling Corporate Citizenship and Its Relationship with Organizational Citizenship Behaviors," Journal of Business Ethics, Springer, Springer, vol. 95(3), pages 357-372, September.
    11. Abagail McWilliams & Donald S. Siegel & Patrick M. Wright, 2006. "Corporate Social Responsibility: International Perspectives," Rensselaer Working Papers in Economics, Rensselaer Polytechnic Institute, Department of Economics 0604, Rensselaer Polytechnic Institute, Department of Economics.
    12. Eng Cheah & Wen Chan & Corinne Chieng, 2007. "The Corporate Social Responsibility of Pharmaceutical Product Recalls: An Empirical Examination of U.S. and U.K. Markets," Journal of Business Ethics, Springer, Springer, vol. 76(4), pages 427-449, December.
    13. Choi, Jong-Seo & Kwak, Young-Min & Choe, Chongwoo, 2010. "Corporate Social Responsibility and Corporate Financial Performance: Evidence from Korea," MPRA Paper 22159, University Library of Munich, Germany.
    14. Giovanni Cespa & Giacinta Cestone, 2002. "Stakeholder Activism, Managerial Entrenchment, and the Congruence of Interests between Shareholders and Stakeholders," UFAE and IAE Working Papers, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC) 528.02, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
    15. Boeddeling, Jann, 2011. "Corporate Social Responsibility: Fundamentalstellung für Kapitalismus und Wirtschaftssoziologie," Discussion Papers 17/2011, Witten/Herdecke University, Faculty of Management and Economics.
    16. Constantine Manasakis & Evangelos Mitrokostas & Emmanuel Petrakis, 2006. "Corporate Social Responsibility in Oligopoly," Working Papers, University of Crete, Department of Economics 0707, University of Crete, Department of Economics, revised 15 Jan 2007.
    17. Allard Made & Lambert Schoonbeek, 2009. "Entry Facilitation by Environmental Groups," Environmental & Resource Economics, European Association of Environmental and Resource Economists, European Association of Environmental and Resource Economists, vol. 43(4), pages 457-472, August.
    18. Ian Worthington & Monder Ram & Harvinder Boyal & Mayank Shah, 2008. "Researching the Drivers of Socially Responsible Purchasing: A Cross-National Study of Supplier Diversity Initiatives," Journal of Business Ethics, Springer, Springer, vol. 79(3), pages 319-331, May.
    19. Rachel Bocquet & Caroline Mothe, 2013. "Profils des entreprises en matière de RSE et innovation technologique," Post-Print hal-00950166, HAL.
    20. Sylvia Maxfield, 2008. "Reconciling Corporate Citizenship and Competitive Strategy: Insights from Economic Theory," Journal of Business Ethics, Springer, Springer, vol. 80(2), pages 367-377, June.
    21. Chieh-Peng Lin, 2010. "Modeling Corporate Citizenship, Organizational Trust, and Work Engagement Based on Attachment Theory," Journal of Business Ethics, Springer, Springer, vol. 94(4), pages 517-531, July.

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