CSR, rationality and the ethical preferences of investors in a laboratory experiment
AbstractThis experimental study aims to clarify to what extent and in which direction investors react to CSR (Corporate Social Responsibility) initiatives meant to upgrade the ethical standards of firms beyond the minimal requirements of law. Subjects in the laboratory were invited to invest their endowment in a portfolio of financial assets. We provided information on the expected returns of each stock and on its inclusion in an ethical index, or exclusion from it. Our findings show that subjects’ behavior appears to be a function not only of their individual pay-offs but also of the information on the ethical standards of the firms issuing stocks. Most of them, however, did not show a fully irrational behavior as they consistently correlated the share of stocks with their expected returns. We may conclude that the sizeable reaction of our sample’s investors to the inclusion of a stock in the ethical index, or its exclusion from it, is the fruit of a deliberate choice.
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Bibliographic InfoPaper provided by Department of Economic Policy, Finance and Development (DEPFID), University of Siena in its series Department of Economic Policy, Finance and Development (DEPFID) University of Siena with number 0609.
Date of creation: Aug 2009
Date of revision:
ethical stock indexes; Corporate Social Responsibility; investors; experiment.;
Other versions of this item:
- Consolandi, Costanza & Innocenti, Alessandro & Vercelli, Alessandro, 2009. "CSR, rationality and the ethical preferences of investors in a laboratory experiment," Research in Economics, Elsevier, vol. 63(4), pages 242-252, December.
- G30 - Financial Economics - - Corporate Finance and Governance - - - General
- M14 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
- Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-11-21 (All new papers)
- NEP-CBE-2009-11-21 (Cognitive & Behavioural Economics)
- NEP-CFN-2009-11-21 (Corporate Finance)
- NEP-EXP-2009-11-21 (Experimental Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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Department of Economic Policy, Finance and Development (DEPFID) University of Siena
0208, Department of Economic Policy, Finance and Development (DEPFID), University of Siena.
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