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Corporate social responsibility: The implications of cost improvement and promotion effort
Author(s) -
Li Chaofan,
Zhou Pin
Publication year - 2019
Publication title -
managerial and decision economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.288
H-Index - 51
eISSN - 1099-1468
pISSN - 0143-6570
DOI - 10.1002/mde.3034
Subject(s) - corporate social responsibility , upstream (networking) , business , promotion (chess) , downstream (manufacturing) , supply chain , production (economics) , industrial organization , marketing , microeconomics , economics , public relations , politics , political science , law , computer network , computer science
We investigate the interaction of these two strategic decisions when corporate social responsibility (CSR) is incorporated into supply chain partners' decisions. Our results show that, with a noncooperative CSR scenario, the upstream manufacturer is more aggressive in investing in innovation to reduce production costs, which strategically lowers the wholesale price to retailers, and the downstream retailer is also less reluctant to engage in more promotion efforts to induce demand in comparison with a cooperative CSR scenario. Furthermore, the customer's sensitivity to promotion effort may hurt the CSR level of each party.