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The Role of Social Activism in the Food Sector

Anubrata Deka, University of Nebraska - Lincoln

Abstract

This dissertation consists of three essays that investigate the role of social activism in the food sector. The first essay develops a game theoretic model to analyze the strategic interaction between a firm that decides the quality of the credence attribute and whether to misrepresent its quality and an activist who monitors the firm and decides whether to launch a campaign to remove false/misleading quality claims. A key result of the paper is that, even in the presence of an activist who always monitors the firm and can accurately detect food fraud, the firm can still find it optimal to misrepresent its product quality. The actual quality of the credence attribute is higher in the presence than in the absence of the activist. The second essay develops a game-theoretic framework to examine how the corporate social responsibility (CSR) investments of a food firm impact an activist’s incentive to monitor the firm to uncover fraudulent behavior and how the firm’s CSR investments and the presence of the activist affect the firm’s incentive to engage in fraudulent behavior. Results show that the greater the firm’s CSR investments, the less likely is that the activist will find it optimal to monitor the firm, and the more likely it is that the firm will find it optimal to mispresent its product quality. The third essay develops an economic experiment to examine how the CSR investments of the firms and the different domain that firms operate in affects the decision of the activist to target a firm. The result from the experiments shows that in a one-shot setting when the activist has limited funds to target only one firm, the activist will choose to target the food firm that has invested in corporate social responsibility (CSR). In repeated settings, where the activist decides whether to test the product quality of the firm and testing is costly, the activist tests the product quality of a food CSR firm relative to a food non-CSR firm

Subject Area

Agricultural economics|Labor relations

Recommended Citation

Deka, Anubrata, "The Role of Social Activism in the Food Sector" (2022). ETD collection for University of Nebraska - Lincoln. AAI29254726.
https://digitalcommons.unl.edu/dissertations/AAI29254726

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