The Third-Person Effects in Investment Decision-Making: The Case of Corporate Social Responsibility

• In Event: The Media and Public Perspectives on CSR Communication

Abstract

The study applies a third-person effects approach to the study of corporate social responsibility. Previous studies have asked what importance investors assign to the socially responsible activities of corporations. However, in the context of publicly-traded companies, it becomes important not only to calculate the effects of available information on the company itself but also to estimate the effects of every piece of information on other investors. The results of the study show that while people are supportive of the socially responsible behaviors of corporations, they perceive others to be less supportive of such behaviors; they also see others as less likely to encourage such behaviors through action. These findings lead to important consequences for investor communications which are discussed in light of the efficient market hypothesis.

Author

• Alexander V Laskin, Quinnipiac University