Measuring and Improving Stakeholder Welfare is Easier Said Than Done

54 Pages Posted: 2 Mar 2020 Last revised: 5 Jan 2022

See all articles by Umit G. Gurun

Umit G. Gurun

University of Texas at Dallas

Jordan Nickerson

MIT - Sloan

David H. Solomon

Boston College - Carroll School of Management

Date Written: January 31, 2020

Abstract

While corporate social responsibility by firms aims at improving welfare for different social groups, whether it achieves this is often difficult to measure. After April 2018 protests, Starbucks enacted policies that anybody could sit in their stores and use the bathroom without making a purchase. Using anonymized cellphone location data, we estimate this led to a 7.0% decline in attendance relative to other nearby coffee shops. The effect is 84% larger near homeless shelters and larger for Starbucks’ wealthier customers. The average time spent per visit declined 4.1%. Public urination citations decreased near Starbucks locations, but other minor crimes were unchanged.

Keywords: Public Good, Socially Responsible Investment, ESG investment, Homeless, Starbucks, Location data

JEL Classification: A11, A13, C55, D02, D22, D61, D62, D63, D64, H23, G30, L21, I15, G34

Suggested Citation

Gurun, Umit G. and Nickerson, Jordan and Solomon, David H., Measuring and Improving Stakeholder Welfare is Easier Said Than Done (January 31, 2020). Available at SSRN: https://ssrn.com/abstract=3531171 or http://dx.doi.org/10.2139/ssrn.3531171

Umit G. Gurun (Contact Author)

University of Texas at Dallas ( email )

2601 North Floyd Road
Richardson, TX 75083
United States

HOME PAGE: http://www.umitgurun.com

Jordan Nickerson

MIT - Sloan ( email )

100 Main Street
Cambridge, MA 02142
United States

David H. Solomon

Boston College - Carroll School of Management ( email )

140 Commonwealth Avenue
Chestnut Hill, MA 02467
United States

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