CSR investment timing in a duopoly: The threat of responsibility violations in the context of socially conscious customers
Year: 2025
Type: article
Abstract: Sustainability in supply chains is increasingly important. Firms risk losing customers if they delay corporate social responsibility (CSR) investment but may gain customers from competitors by acting early. Using a dynamic model, we analyze CSR investment timing in a duopoly. We study when firms adopt responsible strategies to meet socially conscious customers’ expectations to avoid disclosure risks. Small firms invest early to attract customers from larger competitors. In markets with high penalties or disclosure risks, large firms invest relatively early. However, when socially conscious customers dominate, large firms delay investment relative to the small company, leading to a crowding-out effect.
Source: Economics Letters
Authors: Stefan Kupfer, Elmar Lukas
Institutions: Lancaster University, Otto-von-Guericke-Universität Magdeburg
Language: English
Subfield: Strategy and Management
Domain: Social Sciences
Open Access status: hybrid
Estimated APC paid: $3,030
OpenAlex ID: W4415289746