The Effect of Market and Nonmarket Competition on Firm and Industry Corporate Social Responsibility

“Sustainability, Stakeholder Governance and Corporate Social Responsibility” Advances in Strategic Management, Vol. 38: 313-337

40 Pages Posted: 18 Jan 2014 Last revised: 10 Jun 2020

See all articles by Olga Hawn

Olga Hawn

UNC Kenan-Flagler Business School

Hyoung Goo Kang

Hanyang University

Date Written: November 11, 2018

Abstract

We contribute to the emerging literature on strategic corporate social responsibility (CSR) and its antecedents by undertaking a systematic analysis of the effect of rivalry on firm and industry CSR. We deal with the codetermination of competition and CSR by using instrumental variables in the firm-level analysis and by modeling it directly in the industry-level analysis. We find that higher intensity of rivalry and CSR of competitors increase firm CSR, ceteris paribus; however, in a more dynamic setting when firms can change their production output, more competition in fact decreases aggregate industry CSR. While seemingly contradictory, these findings suggest interesting implications for both managers and public policy makers.

Keywords: strategic corporate social responsibility (CSR), market structure, competition, social performance, simulation

Suggested Citation

Hawn, Olga and Kang, Hyoung Goo, The Effect of Market and Nonmarket Competition on Firm and Industry Corporate Social Responsibility (November 11, 2018). “Sustainability, Stakeholder Governance and Corporate Social Responsibility” Advances in Strategic Management, Vol. 38: 313-337 , Available at SSRN: https://ssrn.com/abstract=2380641 or http://dx.doi.org/10.2139/ssrn.2380641

Olga Hawn (Contact Author)

UNC Kenan-Flagler Business School ( email )

Chapel Hill, NC 27599
United States

Hyoung Goo Kang

Hanyang University ( email )

222 Wangsimniro
Seongdong-gu
Seoul, 133-791
Korea, Republic of (South Korea)

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