Does corporate responsibility increase consumers’ product value? Evidence from two experiments

Do consumers reward companies for engaging in corporate responsibility (CR)? Obtaining clear evidence on this question is challenging in naturally occurring purchasing environments due to numerous confounding factors, including brand reputation, product quality, and product appearance. CR predominantly focuses on two dimensions, i.e., (i) the social dimension, like providing fair working conditions, and (ii) the ecological dimension, like using recycled materials in production. We provide new evidence on this debate through two experiments in backpack sales for young adults. We find that CR information about both dimensions increases consumers’ product value by more than 17 percent. In a separate study, we ask whether this effect is potentially entirely driven by one of the two CR dimensions, specifically social versus ecological. We find no significant difference in the increase in consumers’ value between these two dimensions.