{"title":"Cross-ownership and green managerial delegation contracts in a mixed oligopoly","authors":"Mingqing Xing , Sang-Ho Lee","doi":"10.1016/j.jeem.2024.102993","DOIUrl":null,"url":null,"abstract":"<div><p>This study examines strategic interactions between cross-ownership and managerial delegation contracts with environmental corporate social responsibility (ECSR) incentives in a mixed oligopoly. We find that private firms always utilize ECSR incentives in competing prices under cross-ownership, whereas public managers do so only when there is severe environmental damage. We also demonstrate that the ECSR incentives for welfare-weighted public managers are always lower than for their profit-weighted counterparts when they employ ECSR incentives, which leads to lower environmental damage and greater social welfare. Finally, we show that welfare-weighted public delegation increases the private firm's ECSR compared to no public delegation, which is reversed in the profit-weighted variant. Our findings suggest that the government should design an environmental incentive scheme to their public managers that can also induce private managers to behave more aggressively in abatement activities as the degree of cross-ownership increases.</p></div>","PeriodicalId":15763,"journal":{"name":"Journal of Environmental Economics and Management","volume":null,"pages":null},"PeriodicalIF":5.5000,"publicationDate":"2024-04-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Journal of Environmental Economics and Management","FirstCategoryId":"96","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S0095069624000676","RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"BUSINESS","Score":null,"Total":0}
引用次数: 0
Abstract
This study examines strategic interactions between cross-ownership and managerial delegation contracts with environmental corporate social responsibility (ECSR) incentives in a mixed oligopoly. We find that private firms always utilize ECSR incentives in competing prices under cross-ownership, whereas public managers do so only when there is severe environmental damage. We also demonstrate that the ECSR incentives for welfare-weighted public managers are always lower than for their profit-weighted counterparts when they employ ECSR incentives, which leads to lower environmental damage and greater social welfare. Finally, we show that welfare-weighted public delegation increases the private firm's ECSR compared to no public delegation, which is reversed in the profit-weighted variant. Our findings suggest that the government should design an environmental incentive scheme to their public managers that can also induce private managers to behave more aggressively in abatement activities as the degree of cross-ownership increases.
期刊介绍:
The Journal of Environmental Economics and Management publishes theoretical and empirical papers devoted to specific natural resources and environmental issues. For consideration, papers should (1) contain a substantial element embodying the linkage between economic systems and environmental and natural resources systems or (2) be of substantial importance in understanding the management and/or social control of the economy in its relations with the natural environment. Although the general orientation of the journal is toward economics, interdisciplinary papers by researchers in other fields of interest to resource and environmental economists will be welcomed.