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Background assumptions:
-Property rights secure, fully informed, low transaction cost, no negative externalities, scarcity, rational, wants and needs
-Pareto Improvements & Optimality |
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-Stockholder
-only responsibility is to maximize profits within the law without deceptive or fraudulent practices
-can act unethical as long as within law
-"hypocritical window dressing" - all about money, anything else is not maximizing profits and will cause corporation to fail |
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-Stakeholder
-investors are not the only people who matter
-Corporations can exist for purposes other than simply maximizing profits
-most successful businesses put the customer first
-customer-centered business
-critic of Friedman |
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Definition
-Tragedy of the commons
-Double bind: psychologically screwed, if do then feel horrible as no one else is, but if don't everyone else does and you feel stupid
-SI+Markets+Minimal Gov=Efficiency
-Public Good vs. Common Good |
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Definition
| SI+Markets+Business Ethics=Efficiency |
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Definition
-Without property rights markets can't exist
-Property: 1. owned things of a special kind 2. Relations between entities with respect to things
-Hohfeld relations:
Claim right - Duty
Liberty - No Claim Rights
Power - Liability
Immunity - Disability (No Power)
-Honore:
Ownership- complex set of relationships
stick is a relationship person does or does not have
Bundle of Sticks: Ownership, all relations person has wrt the thing |
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Invisible hand:
take people with self interest to Pareto optimality in markets |
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POW Camp:
Markets can and will appear anywhere that
-Spontaneous economic activity led to markets
-Market: a voluntary exchange between buyers and sellers w.r.t. goods and services
Non-market transactions:
1. Gift giving 2. disposal of things (unless paying for it) 3. coercion (gun to your head) 4. Theft |
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Definition
Eminent Domain:
Government has the power to take private property away for public use, provided just compensation is given
-Needs to be for Public Use
-Public use now includes Economic Growth
-Private individual should not benefit from the taking of private property
-Justice O'Connor- this just opens the door |
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Stakeholder
Corporate Social Responsibility
-Attempt to get corporations to act in accordance with certain ethical norms
-voluntary, only guidelines
-Human Rights, Environment, anti- corruption, Labor
Friedman:OK because voluntary
Hardin: Double Bind |
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Definition
-Advocated Markets
Market trade: an activity between two people such that the trade makes both people better off than before the trade happened. The result is greater generation of wealth and creation of increased well being
-Efficiency creating machines
-Efficiency as a moral idea |
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Term
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Definition
Two Liberties:
Positive Freedom- freedom to
-Democracy increases (as a gov)
-Ideal & actual mrkts good if democratic
Negative Freedom- freedom from
-Constitution increases (b of r)
-Ideal good, trade is voluntary & defined property rights
-Actual bad, externalities |
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Definition
-Rights=moral side constraints
-People are ends, not means
-Unless: no rights violated can treat as both means and ends
-Entitlement theory; justice in acquisition, justice in trade, rectification
-Wilt Chamberlain
-Minimal gov
-tax bad
-ideal good, no rights violations
-bad, externalities (violations), court must rectify |
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-Nozick wrong- need to look to future to see injustices in future generations
-Liberty & equality- big
-Redistribution -Social institutions to balance
-Taxation justified
-Robust gov extensive rights |
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-Liberal Egalitarian
-EQUALITY is the only important goal
-YEAH WELFARE
-Personal v. Impersonal P.O.V.
-Gov needs to be Impersonal as ppl will be personal-externalize responsibility
-Robust Gov, Taxes good
-Ideal mrkts good
-Actual bad, inequalities |
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-Internalize Responsibility
-Static v. Dynamic=>Welfare=Bad
-Looks at successes not injustices
-Need developed property rights for IR
-Race
-Apple Orchard |
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-Pullman
-What money can't buy
-Not just to be able to buy everything
-Mixing of Spheres-(slave trade)-leads to inequality; 1st & 2nd class citizens |
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-Business and ethics don't mix
-no place for morals
-will/must compromise values
-thats just the way it is to be successful
(double bind? possibility) |
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