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An Evolutionary Game for the Issues of Social Investment, Environmental Compliance and Consumer Boycott

Author

Listed:
  • André Barreira da Silva Rocha

Abstract

I propose an evolutionary game model to study competition among a large number of firms, in which I take into account the issues of social responsibility, government monitoring of environmental compliance and consumer boycott. A large number of firms sell their homogeneous good in an almost perfect competitive market, where consumers have preferences for socially responsible firms. Firms may incur additional costs and carry out social investment and/or environmental investment. Each time interval, a firm may be called to play a competition-stage game, in which it tries to sell its good, or an audit-stage game, in which inspectors audit its degree of environmental compliance.

Suggested Citation

  • André Barreira da Silva Rocha, 2013. "An Evolutionary Game for the Issues of Social Investment, Environmental Compliance and Consumer Boycott," Discussion Papers in Economics 13/17, Division of Economics, School of Business, University of Leicester.
    • Handle: RePEc:lec:leecon:13/17
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    File URL: https://www.le.ac.uk/economics/research/RePEc/lec/leecon/dp13-17.pdf
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    References listed on IDEAS

    as
    1. Cabral, Luis M. B., 2000. "Introduction to Industrial Organization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262032864, December.
    2. Anastasopoulos, Nikolaos P. & Anastasopoulos, Markos P., 2012. "The evolutionary dynamics of audit," European Journal of Operational Research, Elsevier, vol. 216(2), pages 469-476.
    3. Heyes, Anthony G, 1998. "Making Things Stick: Enforcement and Compliance," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 14(4), pages 50-63, Winter.
    4. Ross Cressman & Jean-Francois Wen & William Morrison, 1998. "On the Evolutionary Dynamics of Crime," Canadian Journal of Economics, Canadian Economics Association, vol. 31(5), pages 1101-1117, November.
    5. Thomas Marmefelt, 2004. "Institutional Endowments and the Lithuanian Holding as Innovative Network: A Problem of Institutional Compatibility in the Baltic Sea Area," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 17(1), pages 87-113, March.
    6. Carmen Arguedas & Hamid Hamoudi, 2004. "Controlling Pollution with Relaxed Regulations," Journal of Regulatory Economics, Springer, vol. 26(1), pages 85-104, July.
    7. Barreira da Silva Rocha, André, 2013. "Evolutionary dynamics of nationalism and migration," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 392(15), pages 3183-3197.
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    Keywords

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    JEL classification:

    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation

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