Does market competition motivate corporate social responsibility? Insight from Malaysia

Kontesa, Maria and Brahmana, Rayenda Khresna and Memarista, Gesti (2020) Does market competition motivate corporate social responsibility? Insight from Malaysia. Jurnal Ekonomi Malaysia, 54 (1). pp. 167-179. ISSN 0127-1962


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This study aims to examine the role of product market competition on Corporate Social Responsibility (CSR) by engaging altruism and utilitarianism views. Using dynamic Generalized Method of Moment panel regression for 524 Malaysian non-financial industry listed companies from 2010 to 2016, we find that firms in a more competitive environments increase their CSR activities. We interpret these results as evidence that CSR is strategically chosen by firms not for the societal benefits, but more on business as usual; a support for utilitarianism view, i.e profit maximizations. It explains the rationale that CSR activities are less employed in a more monopolistic or oligarchic industry. Practically, this study suggests that the CSR activities are forced by market competition. Firms in a more competitive market need CSR as their non-market strategies.

Item Type:Article
Keywords:Product market competition; Product differentiation; Market size; Market concentration; Corporate social responsibility
Journal:Jurnal Ekonomi Malaysia
ID Code:15597
Deposited By: ms aida -
Deposited On:05 Nov 2020 02:15
Last Modified:09 Nov 2020 03:09

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