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Profitable and desirable corporate environmentalism in a delegation contract under incentive subsidy on abatement technologies

Author

Listed:
  • Lee, Sang-Ho
  • Park, Chul-Hi

Abstract

This study investigates corporate environmentalism in a managerial delegation contract and shows that a well-designed subsidy scheme can enhance business profitability and thus, an environmental policy could lead to both social and private benefits. This analysis allows us to better understand the Porter’s concept of environmental policy and firm’s profitability.

Suggested Citation

  • Lee, Sang-Ho & Park, Chul-Hi, 2017. "Profitable and desirable corporate environmentalism in a delegation contract under incentive subsidy on abatement technologies," MPRA Paper 81091, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:81091
    as

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    File URL: https://mpra.ub.uni-muenchen.de/81091/1/MPRA_paper_81091.pdf
    File Function: original version
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    References listed on IDEAS

    as
    1. Stefan Ambec & Mark A. Cohen & Stewart Elgie & Paul Lanoie, 2013. "The Porter Hypothesis at 20: Can Environmental Regulation Enhance Innovation and Competitiveness?," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 7(1), pages 2-22, January.
    2. Lambertini, Luca & Tampieri, Alessandro, 2015. "Incentives, performance and desirability of socially responsible firms in a Cournot oligopoly," Economic Modelling, Elsevier, vol. 50(C), pages 40-48.
    3. Liu, Chih-Chen & Wang, Leonard F.S. & Lee, Sang-Ho, 2015. "Strategic environmental corporate social responsibility in a differentiated duopoly market," Economics Letters, Elsevier, vol. 129(C), pages 108-111.
    4. Poyago-Theotoky, J.A., 2007. "The organization of R&D and environmental policy," Journal of Economic Behavior & Organization, Elsevier, vol. 62(1), pages 63-75, January.
    5. Lee, Sang-Ho & Park, Chul-Hi, 2017. "Eco-Firms and Sequential Adoption of Environmental Corporate Social Responsibility in the Managerial Delegation," MPRA Paper 79881, University Library of Munich, Germany.
    6. Joan Canton & Antoine Soubeyran & Hubert Stahn, 2008. "Environmental Taxation and Vertical Cournot Oligopolies: How Eco-industries Matter," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 40(3), pages 369-382, July.
    7. Kosuke Hirose & Sang-ho Lee & Toshihiro Matsumura, 2017. "Environmental corporate social responsibility : A note on the first-mover advantage under price competition," Economics Bulletin, AccessEcon, vol. 37(1), pages 214-221.
    8. Nirvikar Singh & Xavier Vives, 1984. "Price and Quantity Competition in a Differentiated Duopoly," RAND Journal of Economics, The RAND Corporation, vol. 15(4), pages 546-554, Winter.
    9. Fershtman, Chaim, 1985. "Managerial incentives as a strategic variable in duopolistic environment," International Journal of Industrial Organization, Elsevier, vol. 3(2), pages 245-253, June.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    corporate environmentalism; environmental corporate social responsibility; managerial delegation contract; incentive subsidy scheme; Porter’s hypothesis;

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility

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