Activists and Corporate Behavior in Food Processing and Retailing: A Sequential Bargaining Game
By: Hudson, Darren; Lusk, Jayson L.
Hudson, Darren; Lusk, Jayson L., Activists and Corporate Behavior in Food Processing and Retailing: A Sequential Bargaining Game, Journal of Agricultural and Resource Economics, Volume 29, Issue 1, April 2004, Pages 79-93
This study examines the strategic interaction between food companies and activists using a game theoretic model of sequential bargaining in the absence of complete information. In a rather confined set of circumstances, findings indicate it is always in the best interest of the food company to comply with activists' demands. More frequently, however, there will be cases where compliance is not optimal, depending on the size of the expected effect of protest, cost of defending against protest, and the cost of protest to the activist.