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When Necessity Becomes a Virtue: The Effect of Product Market Competition on CSR

Author

Listed:
  • DANIEL FERNANDEZ

    () (Instituto de Empresa)

  • Juan Santaló

    () (Instituto de Empresa)

Abstract

We report evidence that Product Market Competition is positively associated to widely-used Corporate Social Responsibility ratings. In particular we show that different market concentration measures are negatively associated to social impact ratings. We also provide evidence that changes in import penetration rates instrumented by import tariffs are positively associated to these social ratings. Finally we report that firm pollution levels are negatively associated to market concentration measures. Our results suggest that -all else constant- doubling competition in the marketplace would increase CSR ratings of an average company between 184% and 800%.

Suggested Citation

  • DANIEL FERNANDEZ & Juan Santaló, 2008. "When Necessity Becomes a Virtue: The Effect of Product Market Competition on CSR," Working Papers Economia wp08-27, Instituto de Empresa, Area of Economic Environment.
  • Handle: RePEc:emp:wpaper:wp08-27
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    References listed on IDEAS

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    Cited by:

    1. Catherine Liston-Heyes & Gwen Ceton, 2009. "An Investigation of Real Versus Perceived CSP in S&P-500 Firms," Journal of Business Ethics, Springer, vol. 89(2), pages 283-296, October.

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    Keywords

    Strategy ; Corporate social responsibility; Product market competition;

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