Corporate social responsibility in unionised network industries

International Review of Economics - Tập 68 - Trang 235-262 - 2021
Luciano Fanti1, Domenico Buccella2
1Department of Economics and Management, University of Pisa, Pisa, Italy
2Department of Economics, Kozminski University, Warsaw, Poland

Tóm tắt

In a duopoly network industry with decentralised union wage setting, this paper studies the impact of the firms’ engagement in consumer-friendly corporate social responsibility (CSR) on profitability and welfare. It is shown that, regardless of whether the wage setting occurs prior to or after the choice of the CSR levels, being a CSR-type firm rather than a simple profit-maximiser can lead to larger profits and thus higher welfare for their owners/stakeholders. However, the welfare analysis reveals that there is always conflict of interest between the firms’ owners on the one side and consumers, unions, and society on the other side, with respect for the timing of the decision about CSR relative to that of the wage setting.

Tài liệu tham khảo

Baron DP (2001) Private politics, corporate social responsibility, and integrated strategy. J Econ Manag Strategy 10:7–45 Baron DP (2008) Managerial contracting and corporate social responsibility. J Public Econ 92(1–2):268–288 Baron DP, Diermeier D (2007) Strategic activism and nonmarket strategy. J Econ Manag Strategy 16(3):599–634 Battaglia M, Bianchi L, Frey M, Iraldo F (2010) An innovative model to promote CSR among SMEs operating in industrial clusters: evidence from an EU project. Corp Soc Responsib Environ Manag 17(3):133–141 Becchetti L, Solferino N, Tessitore ME (2016) Corporate social responsibility and profit volatility: theory and empirical evidence. Ind Corp Change 25(1):49–89 Bhattacharjee T, Pal R (2014) Network externalities and strategic managerial delegation in Cournot duopoly: Is there a prisoners dilemma? Rev Netw Econ 12(4):343–353 BloombergBusinessweek (2015) Microsoft’s unionized contract workers get aggressive, 30 Apr 2015. Available online at http://www.bloomberg.com/news/articles/2015-04-30/microsoft-contract-workers-are-organizing Brammer S (2011) Employment relations and corporate social responsibility. In: Townsend K, Wilkinson A (eds) Research handbook on the future of work and employment relations. Edwar Elgar Publishing Limited, Cheltenham, pp 296–318 Brand B, Grothe M (2013) A note on ‘corporate social responsibility and marketing channel coordination.’ Res Econ 67:324–327 Brand B, Grothe M (2015) Social responsibility in a bilateral monopoly. J Econ 115:275–289 Brander JA, Spencer BJ (1988) Unionized oligopoly and international trade policy. J Int Econ 24:217–234 Brod A, Shivakumar R (1999) Advantageous semi-collusion. J Ind Econ 47(2):221–230 Bughin J, Vannini S (1995) Strategic direct investment under unionized oligopoly. Int J Ind Organ 13:127–145 Chirco A, Scrimitore M (2013) Choosing price or quantity? The role of delegation and network externalities. Econ Lett 121:482–486 CNN.com (2021) Google workers have formed the company’s first-ever union. 5th Jan 2021. Available online at https://edition.cnn.com/2021/01/04/tech/google-alphabet-union/index.html CNNmoney (2011) Time for verizon to buy sprint? 23rd Mar 2011. Available online at https://money.cnn.com/2011/03/23/technology/sprint_verizon/index.htm Colombo S, Guerci M, Miandar T (2019) What do unions and employers negotiate under the umbrella of corporate social responsibility? Comparative evidence from the Italian metal and chemical industries. J Bus Ethics 155:445–462 Correa-López M, Naylor RA (2004) The Cournot–Bertrand profit differential: a reversal result in a differentiated duopoly with wage bargaining. Eur Econ Rev 48(3):681–696 Dewenter R, Haucap J, Wenzel T (2011) Semi-collusion in media markets. Int Rev Law Econ 31(2):92–98 Dowrick S (1989) Union-oligopoly bargaining. Econ J 99(398):1123–1142 Dowrick S (1990) The relative profitability of Nash Bargaining on the labour demand curve or the contract curve. Econ Lett 33(2):121–125 Fanti L, Buccella D (2016a) Manager-union bargaining agenda under monopoly and with network effects. Manag Decis Econ 38(6):317–330 Fanti L, Buccella D (2016b) Bargaining agenda and entry in a unionised model with network effects. Ital Econ J 2(1):91–121 Fanti L, Buccella D (2016c) Network externalities and corporate social responsibility. Econ Bull 36(4):2043–2050 Fanti L, Buccella D (2017a) Corporate social responsibility in a game theoretic context. Economia e Politica Industriale - Journal of Industrial and Business Economics 44(3):371–390 Fanti L, Buccella D (2017b) Corporate social responsibility, profits and welfare with managerial firms. Int Rev Econ 64(4):341–356 Fanti L, Buccella D (2018) Profitability of corporate social responsibility in network industries. Int Rev Econ 65(3):271–289 Fanti L, Buccella D (2019a) Corporate social responsibility in a unionised duopoly. Estudios de Economia 46(2):227–244 Fanti L, Buccella D (2019b) Pareto-superority of corporate social responsibility in unionised industries. Arthaniti J Econ Theory Pract 19(2):131–150 Fanti L, Meccheri N (2017) Endogenous sequence of contracts in managerial unionised duopolies. Welfare analysis and product differentiation. In: Fanti L (ed) Oligopoly, Institutions and Firms’ Performance. Pisa University Press, Pisa Foros Ø, Hansen B, Sand JY (2002) Demand-side spillovers and semi-collusion in the mobile communications market. J Ind Comp Trd 2(3):259–278 Fredriksson PG, Gaston N (1999) The “greening” of trade unions and the demand for eco-taxes. Eur J Polit Econ 15(4):663–686 Freeman RE (1984) Strategic management: a stakeholder perspective. Prentice Hall, Englewood Cliffs, NJ Friedman M (1970) The social responsibility of business is to increase its profits. New York Times Magazine García A, Leal M, Lee S-H (2018) Social responsibility in a bilateral monopoly with R&D. Econ Bull 38(3):1467–1475 Garriga E, Melè D (2004) Corporate social responsibility theories: mapping the territory. J Bus Ethics 53:51–71 Goering GE (2007) The strategic use of managerial incentives in a non-profit firm mixed duopoly. Manag Decis Econ 28:83–91 Goering GE (2008) Welfare impacts of a non-profit firm in mixed commercial markets. Econ Syst 32:326–334 Goering GE (2012) Corporate social responsibility and marketing channel coordination. Res Econ 66(2):142–148 Goerke L (2020) Trade unions and corporate social responsibility. Ann Public Coop Econ, Forthcoming Graf C, Wirl F (2014) Corporate social responsibility: a strategic and profitable response to entry? J Bus Econ 84(7):917–927 Greenwood M, Anderson E (2009) I used to be an employee but now I am a stakeholder’: implications of labelling employees as stakeholders. Asia Pac J Hum Resour 47(2):186–200 Hino Y, Zennyo Y (2017) Corporate social responsibility and strategic relationships. Int Rev Econ 64(3):231–244 Hoernig S (2012) Strategic delegation under price competition and network effects. Econ Lett 117(2):487–489 Horn H, Wolinsky A (1988) Bilateral monopolies and incentives for merger. RAND J Econ 19(3):408–419 Katsoulakos P, Sapouna T, Zevgolis D (2004) CSR Classification and Corporate Sustainability Indicators. CSRQuest sustainability framework white paper CA1B, Available online at http://www.csrquest.net/uploadfiles/1B.pdf Katz M, Shapiro C (1985) Network externalities, competition, and compatibility. Am Econ Rev 75(3):424–440 Kopel M, Brand B (2012) Socially responsible firms and endogenous choice of strategic incentives. Econ Model 29(3):982–989 KPMG (2005) KPMG International survey of corporate social responsibility reporting 2005. Available online at https://commdev.org/userfiles/files/1274_file_D2.pdf KPMG (2016a) Corporate responsibility reporting in the technology, media & telecommunications sector. April, 2016. Available online at https://assets.kpmg.com/content/dam/kpmg/pdf/2016/06/survey-sector-supplement-tmt.pdf KPMG (2016b) Corporate responsibility reporting in the Telecom sector. July 2016. Available online at https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2016/08/corporate-responsibility-reporting-telecom-sector.pdf KPMG (2017) The road ahead: KPMG Survey of Corporate responsibility reporting 2017. Available online at https://assets.kpmg/content/dam/kpmg/xx/pdf/2017/10/kpmg-survey-of-corporate-responsibility-reporting-2017.pdf Lambertini L, Tampieri A (2012) Corporate social responsibility and firms ability to collude. In: Boubaker S, Nguyen DK (eds) Board directors and corporate social responsibility. Houndmills, Palgrave Macmillan UK Lambertini L, Tampieri A (2015) Incentives, performance and desirability of socially responsible firms in a Cournot oligopoly. Econ Model 50:40–48 Lommerud KL, Straume OR (2012) Employment protection versus flexicurity: on technology adoption in unionised firms. Scand J Econ 114(1):177–199 Manasakis C, Mitrokostas E, Petrakis E (2013) Certification of corporate social responsibility activities in oligopolistic markets. Can J Econ 46:282–309 Manasakis C, Mitrokostas E, Petrakis E (2014) Strategic corporate social responsibility activities and corporate governance in imperfectly competitive markets. Manag Decis Econ 35:460–473 Marens R (2010) Destroying the village to save it: corporate social responsibility, labour relations, and the rise and fall of American hegemony. Organization 17(6):743–766 Meccheri N, Fanti L (2018) Should managerial delegation contracts be made before or after union wage setting? A game-theoretic analysis. Manag Decis Econ 39(1):3–14 Nakamura Y (2018) Endogenous market structures in the presence of a socially responsible firm. J Ind Compet Trade 18(3):319–348 Nun CW, Tan G (2010) Obtaining intangible and tangible benefits from corporate social responsibility. Int Rev Bus Res Pap 6(4):360–371 Peloza J, Falkenberg L (2009) The role of collaboration in achieving corporate social responsibility objectives. Calif Manag Rev 51(3):95–113 Pencavel J (1985) Wages and employment under trade unionism: micro-economic models and macroeconomic applications. Scand J Econ 87:197–225 Planer-Friedrich L, Sahm M (2018) Why firms should care for all consumers. Econ Bull 38(3):1603–1612 Planer-Friedrich L, Sahm M (2020) Strategic corporate social responsibility, imperfect competition, and market concentration. J Econ 129(1):79–101 Preuss L (2008) A reluctant stakeholder? On the perception of corporate social responsibility among European trade unions. Bus Ethics A Eur Rev 17(2):149–160 Quartz (2017). Silicon Valley tech workers are talking about starting their first union in 2017 to resist Trump. Available online at https://qz.com/916534/silicon-valley-tech-workers-are-talking-about-starting-their-first-union-in-2017-to-resist-trump/ Reputation Institute (2019) 2019 Global CSR RepTrak 100. Available online at https://ri.reptrak.com/hubfs/_PDF/Global%202019_FINAL_March4.pdf Statista.com (2019) Wireless subscriptions market share by carrier in the U.S. from 1st quarter 2011 to 3rd quarter 2018. Available online at https://www.statista.com/statistics/199359/market-share-of-wireless-carriers-in-the-us-by-subscriptions/ The New York Times (2006) In wireless world, cingular bucks the antiunion trend. February 21, 2006. Available online at https://www.nytimes.com/2006/02/21/business/in-wireless-world-cingular-bucks-the-antiunion-trend.html Van Buren HJ, Greenwood M (2011) Bringing stakeholder theory to industrial relations. Empl Relat 33(1):5–21