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Volume 9
Issue 4
Online publication date 2014-01-25
Title How to estimate the model of sustainable profit and corporate social responsibility
Author Komsan Suriya, Tatcha Sudtasan
Abstract
This paper proposes an empirical method to estimate the model of sustainable profit and corporate social responsibility originated by Sudtasan and Suriya (2013). It suggests analysts to use data from official financial statements of companies which may be reported to the Stock Exchange in a particular country. These data can construct a time series data of a company if the number of years is long enough. Otherwise, the pooled cross-section and time series data from companies in the same industry may allow the construction of a panel data set. Then analysts can apply panel data analysis with fixed effects model and random effects model to estimate the data. These methods aim at locating the position of a company or a group of companies onto a phase diagram and calculate the steady state indicating the sustainability of profit and corporate social responsibility. By comparing the location of companies to the steady state, analysts can predict the direction of the firms in the long-run according to the streamlines in the phase diagram. They will be able to suggest policy manipulation to the firms to move toward the steady state. 
Citation
References
Friedman, Milton. 1970. "The Social Responsibility of Business is to Increase its Profits," The New York Times Magazine. September 13, 1970. [online], http://www.umich.edu/~thecore/doc/Friedman.pdf
 
Judge, George et al.1988. Introduction to the Theory and Practice of Econometrics, 2nd ed. New York: John Wiley & Sons.
 
Sudtasan, Tatcha and Komsan Suriya. 2013. "Sustainability of profit and corporate social responsibility: Mathematical modeling with phase diagram," The Empirical Econometrics and Quantitative Economics Letters 2, 4 (December): pp.1-12.
 
Suriya, Komsan. 2011. Econometrics for Development Economics. Chiang Mai: Center for Quantitative Analysis, Chiang Mai University.
 
Suriya, Komsan. 2013. "Econometrics for experimental economics," The Empirical Econometrics and Quantitative Economics Letters 2, 3 (September): pp.37-40.
 
Techanan, Jeeranan and Komsan Suriya. 2012. "Effect of income distribution on poverty reduction after the Millennium." The Empirical Econometrics and Quantitative Economics Letters 1, 4 (December): pp.169 - 179.
 
Vernon, Raymond. 1966. "International Investment and International Trade in Product Cycle," Quarterly Journal of Economics 80 (May), pp.190, http://dx.doi.org/10.2307/1880689
 
Keywords Theory of the firm, mathematical modeling, phase diagram, sustainable development, corporate social responsibility
DOI http://dx.doi.org/10.15208/beh.2013.17
Pages 1-7
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