...Ethics, CSR, and Milton Friedman Marketing in the Era of Managerial Distrust During the first few years of the twenty first century, and in the wake of the terrorist attacks of 9/11, the business world was rocked with news of financial and accounting scandals at major Fortune 500 companies. Enron, a Texas based energy company, lied about profits and was accused of concealing debts so they did not show up in the company’s accounts (BBC News, 8/22/2002). Arthur Andersen, an accounting giant, member of the “Big Six”, and Enron’s corporate auditor, collapsed completely after being found guilty of deliberately destroying evidence of its relationship with Enron (BBC News, 8/22/2002). Tyco executives L. Dennis Kowlowski and Mark H. Swartz were indicted and charged with misappropriating more than 170 million dollars from the company as well as outright stealing 430 million additional dollars through sale of fraudulent shares of Tyco stock (Daniels Funds Ethics Initiative). MCI Worldcom was found guilty of accounting fraud in relation to an overstatement of earnings in 2001 and 2002 (CSR Report for Congress, 8/29/2002), during which time its own auditor was also Arthur Andersen. Executives at each firm (Kenneth Lay, Bernard Ebbers, Dennis Kozlowski, and Mark H. Swartz amongst others) served jail time for their role in these scandals, which severely eroded the public’s trust in the corporate sector. Tyco’s stock plunged from $60.00 to $18.00 in the wake of the scandal...
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...Profits, is considered by many to be the seminal piece of literature against corporate social responsibility. In his article, Friedman argues in favor of unrestricted profit maximization. While Friedman’s argument makes valid points discussing the simple nature of business in a capitalist market, he neglects to effectively address the complex issue of negative externalities that businesses impose on society. I will go on to discuss the errors in Friedman’s assumptions about the capitalist market, and explain how profit maximization can be achieved, while practicing corporate social responsibility. I will discuss more theories on why CSR is not only socially desirable; it is necessary to increase profits. Friedman’s belief that executives who practice CSR are “…unwitting puppets of intellectual forces that have been undermining the basis of a free society these past decades. (31)” He goes to explain how people have responsibilities, not businesses, and that the responsibility of the executive to the business is to increase profits for shareholders (his employers). Friedman’s builds his argument by first explaining that businessman exercising CSR in their business situations is undemocratic because they were not elected to decide how to spend the shareholders money on social agendas, essentially “taxation without representation”. While Friedman makes many valid...
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...1 The process of defining relationships among data to create useful information requires ______ knowledge 2 _____ are people who create, use, and disseminate knowledge and are usually professionals in science, engineering, business, and other areas. Knowledge workers 3 Data that can be used for a variety of purposes is said to be ______. Flexible 4 In information systems, _____ is used to make changes to input or processing activities. Feedback 5 ____ consists of computer programs that govern the operation of the computer. Software 6 An _____ is a network based on Web technologies that allows only selected outsiders, such as business partners and customers, to access authorized resources of a company’s intranet. Extranet 7 ____ is (are) considered to be the most important element in a computer-based information system. People 8 ___ involves using information systems and the Internet to acquire parts and supplies. e-procurement 9 A set of integrated programs that manages vital business operations for an entire multisite, global organization. enterprise resource planning system 10 A(n) _____ is an organized collection of people, procedures, software, databases, and devices that support problem-specific decision making. DSS 11 The ______ is an organized collection of people, procedures, software, databases, and devices to create, store, share, and use the organization’s knowledge and experience. knowledge management system 12 _____ is a branch of...
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...THE ECONOMIC THEORIES OF MILTON FRIEDMAN The Economic Theories of Milton Friedman Milton Friedman was one of the top and most influential economists whose conservative economic theories became influential during the last part of the twentieth century. This paper will explore his economic theories and how his policies were embraced by some conservative politicians but are not as widely adopted today. Milton Friedman would famously say “there is no such thing as a free lunch” (Moore 2012). What he meant was that everything comes with an opportunity cost. If the government spends money then that money must come from the private economy. He was an advocate of capitalism and his views helped revive modern capitalism in the latter part of the twentieth century. He was a proponent of the free market economic system and was opposed to government interference in the economy. Many of his theories have become accepted and lauded by modern day conservative politicians. Milton Friedman was born in Brooklyn, NY in 1912 to immigrant parents. He was awarded a scholarship to Rutgers University where he majored in mathematics. While at Rutgers he became interested in economics due to the poor state of the economy during the Great Depression. After graduating from Rutgers University he went on to receive his master’s degree from the University of Chicago and then on to Columbia University for his doctoral work (Academy of Achievement...
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...of sixteen. His father died during his senior year of high school. Friedman wanted to attended college even though it meant he would have to pay for it by himself. Luckily for Friedman, he was awarded a scholarship from Rutgers University. Friedman enjoyed mathematics and he went to school with the intentions of becoming an actuary (a person finds ways to manage potential risks), instead of what he is now famous for, economics. During his four years at Rutgers, he specialized in mathematics and went as far to taking a few actuarial examines. However, shortly after, he became interested in economics and eventually ended with a major in both actuary and economics. In Freidman’s autobiography, he mentions two men who helped him better understand economics. Arthur Burns, one of the men mentioned, was teaching at Rutgers while completing his doctorate for Columbia. “Burns shaped my understanding of economic research, introduced me to the highest scientific standards, and became a guiding influence on my subsequent career” (citation). Homer Jones was the other individual who had an impact on Friedman’s life. Jones introduced Freidman to rigorous economic theory, made economics exciting and relevant, and encouraged him to go on to graduate work. With Jones recommendation, the Chicago Economics Department offered Friedman a scholarship. He began attending classes at Chicago in 1932. According to Friedman, the most important event of that year was meeting an extremely bright...
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...The World is Flatter With Some Spikes To me both authors are saying the same thing, but they are looking at it from different view points. Thomas Friedman says, “In a flat world you can innovate without having to emigrate.” While Richard Florida says, “ In terms of both sheer economic horsepower and cutting edge innovation, surprisingly few regions truly matter in today’s global economy.” I feel that both are right the world is flatter than in the past, but there are the important spikes. Friedman says the world is flat due to technology and Florida says technology has made the largest cities larger while leaving the valleys behind. I believe that technology has allowed people in the “valleys” to be more creative, find others’ information and build upon it, and test their ideas all from the comfort of their homes. They may have to move to a large city or spike to really make their idea a success, but they may have a better chance than if they just moved to a spike. I think that there will always be spikes because there must be a central place for people to meet and collaborate with one another. This is when the best ideas come together and become more powerful. There are always the people who can do this all remotely like the Apache people in the, World is Flat. For the most part I feel that Silicon Valley would not have been as powerful had everyone stayed in their original location. Plus not every city in the world can be a spike or flat, it would eliminate competition...
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...THE GREAT DEPRESSION. * The Great Depression was the great economic crisis that is said to have been started because of the U.S. stock-market crash in 1929. * Many people lost their jobs. By 1932, 25–30% of people lost their jobs. They became homeless and poor. This ended the wealth of the Roaring Twenties. * From 1929-1932, the depression was at its worst. * Many suspect that increased taxes on American citizens and the increased tariffs (taxes on countries which trade with the United States) worsened it. * Economist Milton Friedman said that the Great Depression was worsened because the Federal Reserve printed out less money than usual. * John Steinbeck wrote ‘Of Mice and Men’ during the great depression and the setting of the book is during the great depression as well. THE AMERICAN DREAM. * The American Dream after and also during the great depression was to own a piece of land making them open to limitless opportunities. * Most of all, it was to have freedom and independence. They wanted to be free from working for anyone and they wanted to live free from relying on wages to get through life. * This dream also included to have stability in their lives. * The American Dream was first known about in 1931 where the author; James Truslow Adams wrote in his book (The Epic of America): "The American Dream is "that dream of a land in which life should be better and richer and fuller for everyone, with opportunity for each according...
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...Notes on The World is Flat (Friedman, 2006) Summary and excerpts from Thomas Friedman’s The World is Flat (2006) by Bill Altermatt CHAPTER 2: THE TEN FORCES THAT FLATTENED THE WORLD page 1 What Tom Friedman means by the phrase “The World is Flat” is that “the global competitive playing field is being leveled…It is now possible for more people than ever to collaborate and compete in real time with more other people on more different kinds of work from more different corners of the planet and on a more equal footing than at any previous time in the history of the world” (p. 8). Friedman believes that this “flattening” of the world is the result of ten factors, which he outlines in chapter 2 of his book: Flattener #1: “11/9/89, The New Age of Creativity: When the Walls Came Down and the Windows Went Up.” On 11/9/89, the Berlin Wall fell (“the Walls Came Down”) and the citizens of the former Soviet empire were suddenly able to participate in the global economy. Friedman uses the fall of the Berlin Wall as a symbol for a general global shift towards democratic governments and free-market economies (where consumers determine prices based on what they’re willing to pay) and away from authoritarian governments and centrally planned economies (in which prices are set by government officials). India made the conversion from a centrally planned economy to a free-market system two years after the Berlin Wall fell, when its economy was on the brink of collapse. Their annual rate of India’s...
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...of the firm was to keep the shareholders at the front line of their decisions. When an insurance company decides what they are going to do to target their customers they make sure that they are going to have a profit so that the shareholders are happy. Another aspect of this paper is going to be on whether or not the government should have a role in the goal of the firm rights of those involved seem to be taken away. The Goal of the Firm The Friedman goal of the firm is that they take the shareholder into consideration when it comes to a profit. He believes that the sole purpose of the goal is to make sure that profits are maximized so that a portion of that profit can be provided to the shareholders, especially if there is a risk in the investment of the company. Not only does Friedman believe that the goal of the firm is to gain a profit for the shareholder but to not have any social responsibilities. In his book Capitalism and Freedom Friedman talks about totalitarianism, which is where the state has control over all aspects of the public and private sector. This is what happens when a company focuses on the "community" rather than the profits that can be made. The only way for a company to make a good profit is they need to make sure that the “proper pricing” is taken into consideration. According to Skousen (2012), “depending on the right prices for a product or service, based on the consumer demand and the company’s competition...
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...Introduction How did economist get everything so wrong? This question is a great question to ask and if you ask the author of the article that was published on the New York Times in September 2, 2009, Mr. Paul Krugman. His response would be that is the economist own fault and problem to why in 2008 the economy fail and we went on a recession. The reason to why he says that it is the economist own fault to why we went on recession was that the economist thought that they had figured out the perfect economy policy due to their research and mathematical formulas that made them think that they had solved the mystery of a perfect non recession economy. So what I mean is that in a way they thought there research and thoughts were bullet proof of recessions and even worse another great depression. Furthermore, in this article Paul goes into deep detail to why economists are the way they are and also if they would ever change their beliefs in the future. However Paul does mention in this article that there are very few economist that did predict that a recession would happen in the future, but due to the fact of hoe cocky economist were with their formula an research that they actually laughed at the these few economist, but at it is said whoever laughs last laughs better. Article Background In this article Paul gives a total description of how we reached our recession in 2008 and he starts giving out details from the history of economy and how the first great depression...
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...Photography and Social Reform John Gizzi ART 125 September 28, 2015 Sarah Baer After watching the video and reading through the assigned readings for the week it became very clear how big of a role photography played during the great depression. Roy Stryker and his team of photographers had a nearly impossible challenge to move and motivate an entire country. Their original job was to convince congress that the millions of displaced Americans desperately needed the government’s assistance. However this was a tough notion to sell to congress and the rest of Americans who were not living through the struggles themselves. There was a huge disconnect between the families affected by the depression and families that had made it through the depression unscathed. The photograph was used by Stryker and his team to document the reality of what was happening all over the American country side. They had to present it in such a way that it did not come across as propaganda. At the time Americans were fed up with the government’s propaganda following the war. The photographs took during this time were able to put a human face and emotion to the barren fields and deserted farms. Photos were used as a tool to communicate the truth and stories of millions of victims of the Great Depression. These iconic photos spoke more than a thousand words, they evoked emotions and understanding throughout the United States. These photos had the power to unite an entire nation. During this course...
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...Thomas Sowell’s interview on basic economics covered many issue such housing crises, high Taxations, spending 17 % of our GDP on healthcare, trade balance, and currency threats in the future. His main focus was the negative side effects of government intervention in a capitalistic market that can lead to downfall of an economy such as the housing crises in 2008. Thomas Sowell wants to limit government intervention and promotes free trade, the same economics that was advocated by Adam smith and Milton Friedman, the right to buy and sell goods and services without interference from the State, the right to have economic freedom without price and wage control from the central government. Thomas Sowell opposes the welfare system strongly, because it increases unemployment, government debt, and inefficiency in the system. Although Thomas Sowell does not specifically talk about welfare system in America in his interview with Peter Robinson, but we can conclude that welfare system is a government intervention to help the needy and end poverty in a country. So therefore, he strongly oppose the welfare system in America because taking wealth from the wealthy and distributing it among the poor creates inefficiency in the capitalistic system and increase the gap of inequality in America. According to Dr. Sowell people who lives in poverty will abuse the system of welfare by not working hard and becoming extremely dependent on wealthy tax payers, basically the government is paying the...
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...What Can The US Learn from Japanese Bubble 1. Easy monetary policy works, but there are risks in the exit. The Federal Reserve’s quantitative easing measures over the past few years have allowed the U.S. economy breathing room to get back on its feet after the worst downturn since the Great Depression. But there are risks that still lurk. If policymakers increase taxes too soon, or if they read the recovery prematurely, they could put the still-tentative U.S. economic recovery in real danger, Goto said. “It’s difficult to measure whether this economic recovery has legs or not,” she said. “In hindsight, the BOJ had misread a lot of the performance of the Japanese economy, and had toyed with the idea of ending that gush of money. What Abenomics has been able to do is to turn back on the spigot,” she said, referring to the current Japanese Prime Minister Shinzo Abe’s plan to breathe life back into Japan. “Japan should have been doing that a lot earlier, so that a comeback could have been easier,” Goto added. “We can learn from that." 2. You can’t divorce financial markets from ‘Main Street’s challenges. Consider what has happened in Japan in recent months. After two decades of subpar performance, the stock market there staged a sharp rally last year, tacking on gains of about 50 percent in roughly 13 months. Japanese stocks took off because of an aggressive round of new easing that was the first part of Abenomics. But what came next was an increase in the consumption tax...
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...have because the world flattened. The fall of the Berlin Wall, Netscape Going Public, Work Flow Software, Uploading, Off shoring, Supply Chains, In sourcing, Informing and Steroids are the ten forces Friedman identifies to be the main causes that flattened the world. The first force that triggered the world to flatten was the fall of the Berlin Wall. The fall of the Berlin Wall helped us to understand the world differently. It helped us to open our eyes and think outside the box rather then just in our own. The fall of the Berlin Wall, allowed us to have a free market, introduced capitalism. We then began to adopt commons standers on how economics should be run along with a common understanding on how banking and accounting should be done. The second force that helped Flatten the world was when Netscape went public. Friedman describes the Internet and how it helped to connect people to come together globally. Netscape was an explosive technology that became w accessible to everyone. This made people want to do things differently and do many more things on the web. The introduction to the browser made computers more useful for millions of people and set of frenzy for the demand of digital things. The introduction to Work Flow Software was another force Friedman lists. Workflow software helped make it easier for international businesses to communicate and collaborate at a fast pace. The fourth flattener...
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...THE CAUSES OF AMERICAN BUSINESS CYCLES: AN ESSAY IN ECONOMIC HISTORIOGRAPHY Peter Temin* This paper surveys American business cycles over the past century. Its task is to identify the causes of these cycles; other papers in this collection address the nature of policy responses to these causes. This paper can be seen as a test to discriminate between two views of the American economy. The first is expressed in a characteristically vivid statement by Dornbusch, who proclaimed recently: “None of the U.S. expansions of the past 40 years died in bed of old age; every one was murdered by the Federal Reserve” (Dornbusch 1997). This stark view can be contrasted with its opposite in the recent literature: “[N]one of the popular candidates for observable shocks robustly accounts for the bulk of business-cycle fluctuations in output” (Cochrane 1994, p. 358). I expand the time period to consider the past century, but it is easy to distinguish the past 40 years, that is, the period since World War II. A survey of business cycle causes over an entire century runs into several problems, of which three seem noteworthy. First, it is not at all clear what “cause” means in this context. Second, the Great Depression was such a large cycle that it cannot be seen as just another data point. Third, the survey relies on the existing literature on business cycles, which is why I have entitled it an essay in economic historiography. The paper proceeds by discussing each of these problems in turn, then...
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