Corporate Social Responsibility or Payoff Asymmetry? A Study of an Endogenous Timing Game

Abstract

We revisit an endogenous timing game by introducing corporate social responsibility into firms' payoffs. Previous research investigates an endogenous timing game in a mixed oligopoly, wherein one welfare‐maximizing public firm competes against profit‐maximizing private firms. It shows that the outcome is completely different from that of private oligopoly. In contrast to its result, we find that this change in payoff does not matter as long as the payoffs are symmetric. Our result indicates that asymmetry, and not welfare‐concerning objectives, yields specific results in the literature on mixed oligopoly.