A game analysis of firms' product safety responsibility basing on the consumer's preference

Applying the basic idea of game thoery, the essay studies on the consumers' pulling game for product safety responsibility(PSR) of firms, the requirement and struggling game between consumers and firms about PSR, and the firms' PSR signaling game. The results show that It is the key to optimize the pareto for firms and consumers that ^b kind of firms fulfil PSR preferably and signal the useful information to the consumers. Because category ^b firms' expected profit is bigger than that of category ^ω, therefore, even though consumers think category ^b firms is better, it is more likely to become a pressuring target, suffering more corporate social responsibility pressure. When the expected profit coming from the target firms is bigger than the struggling cost needed, both category ^b and ^ω firms would choose to fight. Category^b firms adopt the positive PSR signaling strategies, and they send out the signals which can not imitated by the category^ω firms, this method can not only make the market disassociate in a balanced and satisfactory, and solve the problems of category^ω firms expelling category ^b firms, but also can help the category ^b firms create the fine social images, and increase the future profits.