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Upstream collusion and corporate social responsibility in downstream competition

Author

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  • Bin Ying
  • Leonard F. S. Wang
  • Qidi Zhang

Abstract

This paper analyzes the impacts of downstream CSR on upstream tacit collusion. Considering an infinitely repeated game with trigger strategy punishment, we find that how consumer‐oriented CSR affects the stability of upstream collusion basically hinges on the downstream competition modes. Specifically, CSR behavior facilitates (hinders) upstream collusion under downstream quantity (price) competition. For given degree of CSR and product substitutability, upstream collusion is always less stable under downstream price competition. In addition, higher degree of product substitutability obstructs collusion, regardless of downstream competition mode.

Suggested Citation

  • Bin Ying & Leonard F. S. Wang & Qidi Zhang, 2023. "Upstream collusion and corporate social responsibility in downstream competition," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(2), pages 1020-1028, March.
    • Handle: RePEc:wly:mgtdec:v:44:y:2023:i:2:p:1020-1028
    DOI: 10.1002/mde.3728
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