The Economics of Corporate Social Responsibility: A Survey

This article analyzes the economics of Corporate Social Responsible behaviors, namely the voluntary integration of environmental, social and governance factors in firms' strategy. We review theoretical and empirical literature and provide a unified framework of the forces driving corporate social responsibility, relying on three categories of market imperfections: the existence of externalities and public good; consumer heterogeneity; and imperfects contracts. The impacts of corporate social responsibility on corporate performance and society are also surveyed and the lack of knowledge on the latter leads to a research agenda.