Please help! help! business question!?
mmm its much to read dude.
What ethical responsibilities do corporations have?
This of course depends on who you ask. Some would say 'None but to make money' but business society more and more agrees that corporations have social and environmental responsibilities. (This is also good for business, many find.) The ten principles stated by the United Nations Global Compact (http://www.unglobalcompact.org/a...) is a basis for the CSR work in many companies. Late 2010 the new standard ISO 26000 was released, containing definitions of corporate social responsibility (CSR), this overview poster (http://www.iso.org/iso/sr_7_core...) may give a picture of areas where corporations have ethical responsibilities.
What is the relationship between ethics and economics?
Ethics and welfare economics are interlinked. Various social welfare measures like unemployment and old age allowances are based on ethical considerations. So also Corporate Social Responsibilities. Similarly in micro economics we visualise consumer behaviour is based on maximisation of utility from available resources. The wealth maximisation principle also emphasises best use of limited resources. These are based on ethical considerations.However, there are certain production theories such as monopoly, oligopoly, monopolistic competition which aims at profit maximisation of the producers but not that of consumers. Similarly there are certain situations when suppliers of raw materials are in the hands of a few suppliers who control the producers and consumers. This happens in case of oil producing countries. Their pricing may not be based on ethical considerations but on profit maximisation of a few persons.Marx viewed capital as deferred wages. The socialists also viewed that capitalism thrived on exploitation of labourers. Socialism is based on more equitable distribution of means of production. Thus socialism is more attuned to ethical norms than that of capitalism.However in recent times capitalistic societies have also adopted certain socio- welfare measures to ameliorate human sufferings.
Can monopoly exist in a free market?
Theoretically, YES. Practically, NO.What if I tell you that you are free to operate in a market as a producer. But you just don't want to. Why?Because it is not profitable.Then why is the monopolist operating there? Is (s)he an idiot?No.There are certain industries that do not reap profits in the short run and have a long gestation period. It is only in the long run that the monopolistic profits start coming in. As a result of this, not many producers can afford to venture into such industries. This is the case of Natural Monopoly. So basically, nobody is restricting you to enter into the industry, other than your own monetary limitations.You see, barriers are not necessarily imposed, sometimes, they are self-induced by the nature of the industry. This is why it is said that practically, monopoly exists in a market where there is some sort of barrier, be it huge capital investment (in case of natural monopoly), legal restrictions (in case of arms and ammunition), patent/copyright restrictions etc. However, there are umpteen possibilities when we deal with humans. It would be interesting to see a monopolist operating in a market free from all such barriers.
HELP MEEE, *answer these questions for an online class?
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Are large corporations unhealthy for an economy?
Large corporations can be very healthy for an economy, because it’s the only way that certain economies of scale can happen, and some industries absolutely REQUIRE that you have an economy of scale to make the product for anything approaching a reasonable sum.For instance, can you imagine cars being made by a company which is less than $1 Billion in value? What amount a mining operation? Or planes? Or running a multi-state retail business?The problem isn’t merely that large corporations exist. It’s that large corporations have two major detrimental effects that, if no controlled, result in very bad socio-economic outcomes:Too much consolidation in a market results in monopoly or duopoly situations, where a very small number of very large corporations own virtually the entire market, and squeeze out any new competition. This reduces innovation, increases (even unintentional) collusion, and hurts both new product introduction and retail pricing.Large corporations have the means to unduly influence politics. Since they have vast amounts of money, they can use that money to buy/bribe/lobby in such a way as to bend the legislative/regulatory environment to favor them over competitors. They can use the threat of moving operations to extort concessions from governments.In short, having larger businesses is a good thing, though not to the exclusion of small business. Large businesses can provide lower costs due to economies of scale, and smaller business can provide higher customer attention as well as prove to be a testbed of innovations. The major problem is what large corporations become SO big that they completely dominate a market.In my opinion, most markets should have 3–4 large corporations composing 50-75% or so of the total sales volume, a dozen or so medium businesses composing maybe 20-25%, and dozens to hundreds of small businesses the rest.