Carbon Abatement and Socio-environmental Impacts Oriented to Government Policies and Corporate Social Responsibility

Abstract

Under the constraint of considering corporate social responsibility (CSR), companies have to consider the impact of corporate social responsibility on their production operations and carbon abatement decisions. Therefore, we develop three decision models to explore the impact of different subsidy policies on manufacturers’ carbon emission reduction under CSR, and analyze the optimal subsidy policies. Furthermore, we investigate the impact of CSR on social welfare and social environment under different subsidy policies. We find that manufacturers are more willing to reduce carbon emissions, mitigate negative environmental impacts, and improve social welfare under consumer subsidies. However, we find that social welfare and socio-environmental impacts under consumer subsidies are not necessarily better than manufacturer subsidies when the level of CSR is low. Besides, we show that manufacturer subsidies are not always beneficial for improving social welfare and reducing negative socio-environmental impacts. Moreover, we find that manufacturer subsidies may lead to worse environmental impacts and social welfare when the level of CSR is low.