Premium
The Role of Income Distribution in the Diffusion of Corporate Social Responsibility
Author(s) -
D'Alessandro Simone,
Fanelli Domenico
Publication year - 2015
Publication title -
metroeconomica
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.256
H-Index - 29
eISSN - 1467-999X
pISSN - 0026-1386
DOI - 10.1111/meca.12066
Subject(s) - corporate social responsibility , virtuous circle and vicious circle , economics , distribution (mathematics) , diffusion , inequality , income distribution , microeconomics , economic inequality , public economics , labour economics , macroeconomics , political science , law , mathematical analysis , physics , mathematics , thermodynamics
The purpose of this paper is to investigate the link between corporate social responsibility ( CSR ) growth and income distribution. We present a general equilibrium model where social responsibility enters both firms' and consumers' decisions. At equilibrium, different degrees of CSR diffusion may arise. We study the conditions under which there exists a virtuous circle which ties increases in the diffusion of CSR to reductions in income inequality. Under certain circumstances, any policy which promotes CSR diffusion induces a reduction in income inequality. By contrast, when such conditions are not satisfied, only redistributive policies may generate the virtuous circle.