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dc.contributor.authorGlazer, Amihaien_US
dc.contributor.authorKanniainen, Vesaen_US
dc.contributor.authorPoutvaara, Panuen_US
dc.description.abstractThis paper develops a theory of consumer boycotts. Some consumers care not only about the products they buy but also about whether the firm behaves ethically. Other consumers do not care about the behavior of the firm but yet may like to give the impression of being ethical consumers. Consequently, to affect a firm's ethical behavior, moral consumers refuse to buy from an unethical firm. Consumers who do not care about ethical behavior may join the boycott to (falsely) signal that they do care. In the firms' choice between ethical and unethical behavior, the optimality of mixed and pure strategies depends on the cost of behaving ethically. In particular, when the cost is (relatively) low, ethical behavior arises from a prisoners' dilemma as the firms' optimal strategy.en_US
dc.publisherCenter for Economic Studies and Ifo Institute (CESifo) Munichen_US
dc.relation.ispartofseriesCESifo working paper 2323en_US
dc.subject.keywordFirms' ethical codeen_US
dc.subject.keywordconsumer moralityen_US
dc.subject.stwStrategische Unternehmensplanungen_US
dc.titleFirms' ethics, consumer boycotts, and signallingen_US
dc.typeWorking Paperen_US
Appears in Collections:CESifo Working Papers, CESifo Group Munich

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