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Should partially cooperating firms care for consumers?

Author

Listed:
  • Kazuhiro Ohnishi

    (Institute for Economic Sciences, Japan)

Abstract

This paper considers a multi-stage game model with two partially cooperating firms whose objective functions include maximizing not only their own profits but also a portion of their rivals' profits. In the first stage, each firm independently and simultaneously decides whether to incorporate consumer surplus into its objective function. In the second stage, any firm that chooses to do so selects its level of consumer orientation. In the third stage, after observing the rival's choices in the first two stages, each firm independently and simultaneously chooses its output level. The paper characterizes the model's equilibrium and conducts the welfare analysis.

Suggested Citation

  • Kazuhiro Ohnishi, 2026. "Should partially cooperating firms care for consumers?," Economics Bulletin, AccessEcon, vol. 46(2), pages 656-663.
    • Handle: RePEc:ebl:ecbull:eb-26-00038
    as

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    File URL: http://www.accessecon.com/Pubs/EB/2026/Volume46/EB-26-V46-I2-P57.pdf
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    References listed on IDEAS

    as
    1. Toshihiro Matsumura & Akira Ogawa, 2016. "Corporate social responsibility and endogenous competition structure," Economics Bulletin, AccessEcon, vol. 36(4), pages 2117-2127.
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    9. Michael Kopel, 2015. "Price and Quantity Contracts in a Mixed Duopoly with a Socially Concerned Firm," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 36(8), pages 559-566, December.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    JEL classification:

    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior

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