Strategic CSR in asymmetric network duopoly
摘要
We study strategic corporate social responsibility (CSR) in an asymmetric-cost Cournot duopoly producing a homogeneous network good under passive consumer expectations. Firms first choose CSR weights (modeled as nonnegative weights on consumer surplus) and then compete in quantities; the game is solved by backward induction. Network effects change the commitment value of CSR: relative to a benchmark without CSR, strategic CSR lowers the survival threshold of the less efficient firm, so consolidation pressures strengthen as network intensity rises. In the interior region with two active firms, the equilibrium is unique: the more efficient firm endogenously selects a higher CSR weight, supplies more, and earns more, while the rival’s CSR and output decline as the cost gap widens. Regarding welfare, CSR unambiguously raises consumer surplus and lowers prices by credibly expanding output; total surplus exceeds the benchmark whenever the less efficient firm’s output does not increase under CSR, a condition that naturally occurs near the survival margin. The results clarify when CSR in network markets expands coverage and lowers prices, and when it tilts the industry toward concentration, with implications for competition policy in digital and communications sectors.