TITLE:
Endogenous Choice of Competition Modes in a Differentiated Duopoly with Corporate Social Responsibility
AUTHORS:
Shih-Hao Huang, Chu Chuan Hsu, Jen-Yao Lee, Su-Ching Tsai, Yung-Chung Kang
KEYWORDS:
Corporate Social Responsibility (CSR), Price Competition, Quantity Competition
JOURNAL NAME:
Theoretical Economics Letters,
Vol.15 No.3,
April
30,
2025
ABSTRACT: This paper examines how the corporate social responsibility (CSR) affects endogenous choice of competition modes. The behavior of the relevant firms and the decision policy are explored. We find that in the case of product substitution, the introduction of CSR policies by firms focusing on consumer rights will reverse the traditional quantitative competition results as the dominate strategy. Price competition becomes the dominate strategy and welfare will increase as the degree of product substitution decreases or the weight of consumer rights increases.