The Relationship between Corporate Social Responsibility and Social Welfare
Date Issued
2015
Date
2015
Author(s)
Lin, Tai-Yi
Abstract
This thesis studies the social welfare effect of corporation social responsibility policy. In this thesis, we put the corporations’ morality as a factor in our model, and we consider CSR as a conduit sending the message of its own morality type. We set up an information asymmetric game model, to investigate that what’s the CSR actions of different types of corporations, and to investigate the social welfares of different equilibriums. In this model, we can discover that: when the goal of the good type corporation is maximizing profit, it often leads to a condition without equilibrium, or a condition that neither good nor bad type corporation do the CSR activity. In this condition, the social welfare is less than the other possible equilibriums. To improve this condition, the government can offer a CSR subsidy to change the equilibrium conditions, or the good type corporation can change its objective function, which means to make CSR decisions by the CSR project’s NPV. By these two method, we can improve the equilibrium, and therefore increase the social welfare.
Subjects
CSR
corporate social responsibility
social welfare
game theory
information asymmetry
SDGs
Type
thesis
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