...There are many features to the libertarian worldview. Individualism is the foundational principle of libertarianism. Human beings have dignity and are capable of making their own decisions. Everyone has the right to choose how they pursue life, liberty, and ownership of property and no one has the right to encroach upon an individual’s freedoms. Furthermore, people must be responsible for the consequences of their decisions. Libertarians also emphasize the value spontaneous order. Absent of central planners, the accumulation of people’s free choices is a complex network of real order. Civil societies, languages, markets, and laws have come about because free and like-minded individuals collaborate in order to each achieve their purposes. Libertarians are very skeptical of government. Because of their emphasis on individualism and spontaneous order, they view much of the existing political structure as unnecessary. However, most libertarians believe that the state is responsible to protect the inherent rights of humans. Valid functions of the state include law enforcement, the justice system, and basic military. Libertarians especially emphasize the need for protecting incentives. Incentives motivate individuals. Without incentives, societies will not advance. Therefore, the state must ensure that individuals get to keep the rewards of their efforts. Libertarian philosophy stresses the importance of free markets. As individuals have the right to secure property...
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...business policies has taken a stance against the previous operational strategy that a business exists only to make profit without any consideration or regards to anything else in the world as said by the economist Milton Friedman in his essay “deriding the idea that a business had any responsibility other than to maximise its profits within legally and ethically acceptable margins, arguing that ‘a corporate executive is an employee of the owners of the business. A few new theories were introduced in the famous essay written by Milton Friedman. These theories suggested that the only reason a business exists is to make profit and this is done through the actions of all the executives of any business. The only reason an executive is employed is to take decisions that will have a direct affect on the profitability of a business and thus in effect it will be the consequent to the livelihoods of the employees of any corporation. It is exactly for these beliefs that the idea of a socially responsible corporation seems like a far-fetched one in the era when this philosophy was hailed as the cornerstone of the ideology required for any business operation, where the only reason a business existed was to make money and that’s all. The whole argument involves around the case of CSR, how exactly to describe the definition is where the ambiguity starts, or does it? Within the economic industry the main responsibility of any corporation has been to make money and to increase the business value...
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...raise the world’s living standards. Its call for open markets is direct. It is often not simple to put in practice as public policy. Its decline during the turbulent years between World War I and II underscores how difficult it is to put such policy in place. Nevertheless, by the I 950s the world economy again resumed its upward trend toward globalization. Still, the road is not smooth. Turbulence In Capital and Money Markets Critics of the International Monetary Fund (IMF) argue that the JiMF’s mistakes may well have created a backlash against globalization in the post-Cold War years.2 The Asian and Russian crises in the closing years of the 1990s and IMF attempts at fixing problems complicated the advance of Western-type market economies. A case in point is Malaysia, which in September 1998 effectively cut * George Macesich, profesor i direktor na Institute for Comparative Policy Studies, Research and Exchanges na Florida State University, Tallahassee, Florida, SAD. Ovaj je rad pripremljen za seminar koji je održan 27. 3. 2003. na College of Engineering, University of South Florida, Tampa. Rad primljen u uredništvo: 5. 5. 2003. 1 Brookings Trade Forum 1999 (Washington, DC: The Brookings Institute, 1999). 2 See, for instance, Milton and Rose Friedman, Two Lucky People: Memoirs (Chicago: University of Chicago Press, 1998), pp 219-221. 504 G. MACESICH: Globalization: Problems and Prospects EKONOMSKI PREGLED, 54 (5-6) 503-509 (2003) itself off...
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...owners to consider in order to prosper and have workers that want to strive to become the best for the company. Many years companies were worried about making money but not worried about how society benefits. In recent years, it has become important for companies to demonstrate how the company will help individuals and the economy to flourish. This has become a big concept for companies to adopt guidelines in ethics that puts individuals first before the company operations. There have been some individuals that have presented their views of what social responsibilities are, such as Peter Drucker, William Cohen, Milton Friedman, and Gayle Beebe. They have explained the methods of ethics in business and how social responsibilities become a part of the ethics picture (Jennings, 2012). Social responsibility is a business concern for social welfare and how it prospers with the company growth. Social responsibilities are also obligations of companies to have and develop and implement courses of action that aids in impacting the issues that affects society. Corporations must look at their legal responsibilities, legitimacy, and what charitable contributions that it has made to society in areas where the company operates. This means that companies have to focus on the long-term goals of how society will grow. The company helps society through their business as a main goal. Companies reap success when society prospers and meets the needs of society. This means companies need...
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...and what we wear. It also contributes heavily to consumerism, and ruthlessly seeks profits while ignoring the consequences of its actions. Governments, instead of controlling this powerful institution, have instead reduced regulatory policies, giving corporations agency to commit immoral acts while receiving slighter repercussions. Joel Bakan’s book, The Corporation, analyzes the corporation’s tendency to break the law for the sake of their shareholders. The question is: for whom does the corporation truly work for, the public, the employees, or the shareholders? The answer is the shareholders. The corporation exists solely to serve its shareholders, and its’ employees and the public are merely stepping stones to higher profits. Bakan makes clear that the corporation is a pathological beast. “Because it has to maximize its profits… everything is legitimate in the pursuit of that goal. So using child labor or sweatshop labor or despoiling the environment… is legitimate” (Bakan 55). Milton Friedman also states that CEOs must only focus on generating profits. If they do not, they violate the fundamental legal mandate: “to put shareholder interests above all others”. (45) According to Milton Friedman, if CEOs do not “act in accordance with the best interests of their shareholders, they are immoral” (Bakan 28). As the law imbues corporations with the singular purpose of gaining profits for its shareholders, CEOs must only pursue this goal. Milton Friedman further states that if any...
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...failed to foresee, but he soon recouped. At Keynes's death, in 1946, his worth stood just short of £500,000 – equivalent to about £11 million ($16.5 million) in 2009. His first prediction was a critique of the reparation payments that were levied against the defeated Germany after WWI. Keynes rightly pointed out that having to pay out the cost of the entire war would force Germany into hyperinflation and have negative consequences all over Europe. He followed this up by predicting that a return to the prewar fixed exchange rate sought by the chancellor of the exchequer, Winston Churchill, would choke off economic growth and reduce real wages. The prewar exchange rate was overvalued in the postwar damage of 1925, and the attempt to lock it in did more damage than good. On both counts, Keynes was proved right. (For related reading, see War's Influence On Wall Street.) Giants Of Finance: John Maynard Keynes February 13 2009| Filed Under » Economics, Futures...
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...Claremont Colleges Scholarship @ Claremont CMC Senior Theses CMC Student Scholarship 2012 Corporate Social Responsibility and Financial Performance: Does it Pay to Be Good? Harmony J. Palmer Claremont McKenna College Recommended Citation Palmer, Harmony J., "Corporate Social Responsibility and Financial Performance: Does it Pay to Be Good?" (2012). CMC Senior Theses. Paper 529. http://scholarship.claremont.edu/cmc_theses/529 This Open Access Senior Thesis is brought to you by Scholarship@Claremont. It has been accepted for inclusion in this collection by an authorized administrator. For more information, please contact scholarship@cuc.claremont.edu. CLAREMONT McKENNA COLLEGE CORPORATE SOCIAL RESPONSIBILITY AND FINANCIAL PERFORMANCE: DOES IT PAY TO BE GOOD? SUBMITTED TO PROFESSOR MATTHEW MAGILKE AND DEAN GREGORY HESS BY HARMONY J. PALMER FOR SENIOR THESIS FALL 2012 DECEMBER 3, 2012 Acknowledgements I have many people to thank for their help with this study. First and foremost, I want to thank my thesis reader, Professor Magilke, for all his help. This study would have be quite difference without his constant guidance and our numerous meetings and e-mail exchanges. Second, I would like to thank Mary Martin, the Reference & Instruction Librarian for Business and Law, at the Claremont Colleges Library. Obtaining the CSR data would not have been possible without her help and the library’s funding. Third, I want to thank the Kravis Leadership Institute...
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...Research Paper DOES CORPORATE RESPONSIBILITY TO STAKEHOLDERS MAXIMIZE FIRM’S VALUE? DOES CORPORATE RESPONSIBILITY TO STAKEHOLDERS MAXIMIZE FIRM’S VALUE? Topic: This paper seeks to explore the economic mechanisms behind corporate responsibility based on a microeconomic perspective of the firm. The ultimate objective is to ruminate on the effects of corporate responsibility of firms to stakeholders. That is how corporate responsibility to stakeholders can help maximize or minimize the firm’s value. In this research paper, I am going to explain the principle of stakeholder and the corporate social Responsibility that corporation owes to its stakeholders. The fact that corporations are entitled to its stakeholders and the environment within its scope of business has been a controversial issue. At the beginning, I will give a clear understanding of what Corporate Responsibility by firms to its stakeholders is. Later, I will make an argument in favor and against Corporate Responsibility by the firm to its stakeholders. Lastly, I will come to a conclusion on how firm’s value is maximized. That is what corporation should do for its stakeholder. According to rigorous research, each person has his or her personal responsibility that needs to be performed in order to maintain a good image in the society. Just as humans are faced with responsibilities, so as Corporations, since they are seen as a group of individuals working together to accomplish a goal, that goal being making...
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...conditions for market efficiency. Do companies have their internal resources distributed through an internal market of supply and demand for works? Suggest implications for you as future managers. 2. (a) It has been said that we are ‘addicted to oil’. How can you explain this in terms of income and price elasticity of demand? Try to define income and price elasticity, definition of in-/elastic demand, implications for revenue and pricing strategy. (b) Give some examples of things that could make the demand for oil more elastic. What specific policies could the government or companies take to make demand more elastic? (c, optional, harder) Which reasons may explain the recent drop in oil prices in 2015? Suggest some implications for you as future managers. 3. Milton Friedman famously wrote an article entitled “The social responsibility of business is to increase its profits.” After reading the article and related literature, consider the question of whether projects aimed at enhancing social responsibility are undermining the goal(s) of shareholders? Explain your reasons for and against, think of modern changes in the world that enhance or disable Friedman’s statement, suggest implications for managers. QUESTION 1 A real market economy ensures that greed is good – John Kay 18 January 2012, Financial Times Sixty years of division of the Korean peninsula has created two states with very different standards of living in one country. The Korean example is pathological. The division...
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...conducting business activities overseas. When conducting these activities, implications arise for participating domestic, international firms and its governments. In this essay, it focuses on the implications on the Australian government as Australian firms conduct business activities with international firms. This is observed through two selected Australian newspaper articles, “Trade ties with Indonesia poor: exporter” (Perry, 2013) and “What does an arms trade treaty means to us in Australia?” (Mallinson, 2013). In addition to identifying the implications, an analysis of each article deals with the relations to the international business concepts such as ethical social responsibility and the relevance to “the Friedman Doctrine” (Friedman, 1970) and political economy in country attractiveness to conducting business activities. The Australian firm, Elder, the exporter of Australian cattle has endure implications towards the Australian government, resulting in poor international trading with international firms. Through “Trade ties with Indonesia poor: exporter” (Perry, 2013), it describes “trade relations with Indonesia are poor”(Perry, 2013) specifically the agriculture cattle industry and criticises the “policymakers”(Perry, 2013) classified as the Australia government. In 2011, a public outrage occurred when “horrific footage from Indonesian abattoirs that uses Australia cattle has revealed abuse of the animals” (Worthington, 2011). Following the event, the Australian government...
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...POWER AND WEALTH Individual Assignment “Power and wealth are intricately linked. Critically discuss drawing on at least two perspectives from the field of International Political Economy and practical examples from the global political economy” Introduction Robert Gilpin (1975) once defined International Political Economy as the “reciprocal and dynamic interaction in international relations of the pursuit of wealth and the pursuit of power”, allowing for the understanding of the relevance of power and wealth in the global economy. The study of International Political Economy provides an understanding of the interaction between the Market and the State, as well as the importance of their existence within countries around the world. In studying this particular area, it is important to familiarize oneself with the key elements and determinants which make up the global economy. Two factors which play an essential role in the global political economy are Power and Wealth. These are considered to be significantly linked, as they share many similar attributes, and many corporations and actively involved members of the State seek to achieve and/or maintain both aspects. Power is globally acknowledged as the ability to influence the behavior in other individuals, or the authority to make decisions. As illustrated by Dahl (1957), the intuitive idea of power allows for the understanding that “A has power over B to the extent that he can get B to do something that B would not otherwise...
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...Some businesses, especially big businesses, shape many aspects of our lives. Some are around us all the time. Some have turnovers larger then a normal person can imagine. Some multi nationals have turnovers larger then some states. That being the case, how de we want them to conduct themselves? How do we want them to behave? To start, we have to answer some questions. What is important when you are a businessman and you manage a business? Do you have some responsibility to the society and the rest of the world? To answer these questions we are going to look at both sides of the spectrum. At one side of the spectrum we have the free market views of people like the economist Milton Friedman. He has argued that a business not should think about the society and the problems that the society meets. The only social responsibility of a business is to make money and get the highest profit as possible – anything else is theft from the shareholders pocket. “There is one and only one social responsibility of business–to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud." (Friedman 1970). He also claims that you cannot do good with other people’s money, social work is only for governments and for social workers. The business of business is business. On the other side, almost every business in the world is part of a society. Businesses...
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...July to August 2012 were unchanged. At the end of August 2012 there were 3.6 million job openings on the last business day as there were in July. The Department of Labor stated that there is an employee hire rate of 3.3% and a separation rate of 3.3%; this is part of why the number of job openings did not change from July to August. The number of job openings changed in all industries except accommodation and food services, in these areas the numbers decreased. Overall this is an increase from 2009 where there were 2.4 million job openings. In 3 years we have increased the number of jobs available by 1.2 million jobs. Of this increase the amount of government jobs changed very little, jobs increased for nondurable goods manufacturing, wholesale trade, finance, insurance, and federal government. Most of the job openings are in the North East of the US and in the South. Positions decreased in mining and logging careers, this trend may stay on a decline due to the change of public interest. We are trying to conserve trees so logging positions are not as in high demand as they have been historically, we use more electronic communication than paper and we recycle, this all contributes to the decline of the logging demand. We are still building houses, and there is a need for logging to provide wood for homes, but even there we are using recycled materials and finding alternatives. Mining industry is also going to stay on the decline due to finding alternatives to energy. We are...
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...“There is one and only one social responsibility of business – to use it resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to stay, engages in open and free competition without deception or fraud” (Friedman, 1970). As one of the most influential economic scientist in the 20th century, Milton Friedman did this statement 41 years ago. In the last three decades the world economy went through a large change. Affected by the crisis of the industrial capitalism in the 1970s, the currency crisis in the 1980s or the financial crisis in 2007, business needed to readjust itself every time it reaches its limit. Especially concerning the collapse of the real estate and financial bubble in 2007, a re-orientation for organizations to concentrate on long-term performance instead of inconsiderately accumulating capital was and is required. “Adopting business strategies that meet the needs of the enterprise and its stakeholders today while sustaining the resources, both human and natural that will be needed in the future” (KPMG, 2011). Those strategies to fulfill sustainable criteria are the elements of Corporate Social Responsibility. But as Friedman mentioned, the goal of an organization is to increase its profits. Could this be a win-win-situation for organizations and the environment? Or is the assumption correct, that this obvious contrast could only satisfy one party? If so, wouldn’t be the use of CSR be more a marketing...
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...1. BOP (Balance Of Payment) In economics, the balance of payments, (or BOP) measures the payments that flow between any individual country and all other countries. It is used to summarize all international economic transactions for that country during a specific time period, usually a year. The BOP is determined by the country's exports and imports of goods, services, and financial capital, as well as financial transfers. It reflects all payments and liabilities to foreigners (debits) and all payments and obligations received from foreigners (credits). Balance of payments is one of the major indicators of a country's status in international trade, with net capital outflow.[citation needed] The balance, like other accounting statements, is prepared in a single currency, usually the domestic. Foreign assets and flows are valued at the exchange rate of the time of transaction. IMF definition The IMF definition: "Balance of Payments is a statistical statement that summarizes transactions between residents and nonresidents during a period."[1] The balance of payments comprises the current account, the capital account, and the financial account. "Together, these accounts balance in the sense that the sum of the entries is conceptually zero."[1] * The current account consists of the goods and services account, the primary income account and the secondary income account. * The financial account records transactions that involve financial assets and liabilities and that...
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