This paper examines endogenous corporate social responsibility (CSR) in a monopolistic network industry in which participation generates both network benefits and congestion. We develop a fulfilled-expectations model and compare the firm’s CSR, pricing and output decisions under passive and responsive consumer expectations. Under passive expectations, positive network externalities always sustain CSR, whereas sufficiently strong congestion may eliminate commitment when consumers’ sensitivity to CSR is limited. Under responsive expectations, CSR is always strictly positive. Whenever the passive solution is interior, responsive expectations induce stronger CSR under congestion but weaker CSR when positive network benefits dominate. The profit and welfare rankings across expectation regimes similarly depend on the nature of network interactions. Nevertheless, within each regime, endogenous CSR raises monopoly profit, consumer surplus and social surplus relative to the corresponding no-CSR benchmark whenever it is adopted. These findings remain robust when production involves increasing marginal costs. Allowing for heterogeneous expectations further shows that, under congestion, a sufficiently large share of responsive consumers can eliminate the no-CSR outcome.
