Altruism, Hybrid Firms, and Mixed-Market Competition

• In Event: Challenges and Opportunities of Hybrid Organization Models

Abstract

In recent years, the emergence of new legal forms allowing for-profit firms to incorporate with a formal commitment to both social purpose and profit has blurred the traditional distinctions between for-profit and nonprofit firms. Modeling nonprofit entrepreneurs to be either pure or warm-glow altruists, concerned alternatively with consumer surplus, quantity sold, or quantity of charitable services provided, we analyze Cournot equilibria in markets shared by an altruistic firm and a for-profit, nonprofit, or hybrid competitor.

Authors

• Eleanor Brown, Pomona College

• Qing Fan, Pomona College

• Yufeng Hu, Pomona College