Effect of corporate social responsibility on privatization policy: linear cost approach

Kadohognon Sylvain Ouattara ()
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Kadohognon Sylvain Ouattara: Institute of Sustainable Business and Organizations, Confluence Sciences et Humanités - UCLy, ESDES

Economics Bulletin, 2022, vol. 42, issue 2, 536 - 545

Abstract: This paper analyzes the effect of corporate social responsibility on the optimal degree of privatization in a mixed oligopoly where the technology of each firm is represented by a linear cost function. Some recent studies show that when costs are quadratic and firms are equally efficient, the government should decrease the degree of privatization if the level of CSR increases. In this paper, we highlight the sensitivity of the privatization policy to the cost structure of firms. In contrast to the result obtained when production costs are quadratic, we show that the optimal level of privatization increases with the level of CSR in the several relevant cases.

Keywords: Corporate social responsibility; Mixed oligopoly; Partial privatization; Public firms (search for similar items in EconPapers)
JEL-codes: L1 L3 (search for similar items in EconPapers)
Date: 2022-06-30
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