Academic

Dell and Microsoft have teamed up to sell ?(Red)? computers, promising to donate up to $80 for every product sold to the Global Fund?s effort to fight HIV/AIDs in Africa.  As I have posted before, (Red) is a product brand founded by U2 singer Bono and Bobby Shriver, pursuant to which corporations that use the brand make a commitment to donate profits from the branded products to help fight HIV/AIDs in Africa.  In fact, Bono apparently helped design the (Red) Dell PC.  The initiative seems like one of those ideal instances where corporations can do well and do good.  Indeed, even though the price of the (Red) branded Dell model is apparently the same as non-(Red) branded Dell models, it is clear that there are many people who not only gravitate towards products that promise to divert some of the proceeds to charity, but there are also people who are willing to pay more for such products.  And perhaps the seeming transparency associated with the (Red) product brand gives both investors and consumers some comfort because corporations make an up-front commitment about how proceeds will be diverted to charitable endeavors.  In addition, corporations divert such proceeds to a particular and established charitable entity, limiting managerial discretion (and potential abuses of that discretion) sometimes associated with corporate charitable giving.  In this regard, it is an ideal mechanism for encouraging corporations to engage in charitable works.