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MGX3100: Ethics in Capitalism

This document provides an introduction to management ethics and corporate governance. It discusses key concepts like capitalism, socialism, and the moral justifications of capitalism. Capitalism is defined as a system where private ownership of production exists, while the state controls areas like health and education. Socialism involves public ownership of production. Capitalism is justified based on both rights and consequences. Rights-based views argue for a natural right to private property, while consequentialist views assert capitalism produces better outcomes. The document outlines criticisms of capitalism and provides an overview of case study analysis in business education.

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Haozhang Wang
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10 views6 pages

MGX3100: Ethics in Capitalism

This document provides an introduction to management ethics and corporate governance. It discusses key concepts like capitalism, socialism, and the moral justifications of capitalism. Capitalism is defined as a system where private ownership of production exists, while the state controls areas like health and education. Socialism involves public ownership of production. Capitalism is justified based on both rights and consequences. Rights-based views argue for a natural right to private property, while consequentialist views assert capitalism produces better outcomes. The document outlines criticisms of capitalism and provides an overview of case study analysis in business education.

Uploaded by

Haozhang Wang
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Management Ethics and Corporate Governance MGX3100

Session 1 Introduction

Capitalism
A capitalist system is one in which the greater part of the means of production are in private hands
Manufacturing Transport Banking Insurance Mining Telecommunications Media

Capitalism (cont)
The state is left to control
Health Education Welfare Defence

Socialism
In a socialist system there is public ownership and control of the means of production and distribution. Centralised planning rather than individual decision characterises the socialist system

Key Features of Capitalism


The existence of companies artificial beings existing only in the contemplation of law Profit motive Competition the regulator of individual economic activity Private property private ownership of the means of ownership and distribution

Moral/Ethical justifications of Capitalism


Two historically important justifications
Rights based justification Justification based on consequences

Rights based justifications


The natural right to property John Locke 18th century English philosopher Lockes theory of property
When we mix our labour with the natural world we have a right to what is produced
The peasant growing vegetables The shoemaker making a pair of shoes

Problems with Lockes account


Inherited wealth? Investment income? Interest?

Consequentialist justification
Capitalism produces better consequences/outcomes for individual citizens than alternate economic arrangements

Adam Smiths consequentialist position


Adam Smith 18th century English economist Smiths famous invisible hand argument
It is his own advantage and not that of society that he has in view .(but) by directing that industry in such a manner as its produce may be of the greatest value, he (is) led by an invisible hand to promote an end that was no part of his intention

Criticisms of Capitalism
Produces inequality Produces human beings that are wholly economic creatures Produces monopolies and oligopolies True competition is rare Produces exploitation Produces alienation

The case study method


What is a case study?
A description or history of an actual situation presenting a dilemma for an individual or organisation

Cases may be presented in different ways


Written cases
Short or long Resolved or unresolved

Video cases

Difficulties with the case study method


Problem of knowing what to do What are we learning? Why doesnt the teacher teach?

Steps involved in the analysis of cases


Understanding the situation Diagnosing the problems Generating alternative solutions Predicting outcomes of those different solutions Evaluating alternatives Deciding what is the best alternative Communicating the results

Reading case studies


What to look for in a case study
Who are the players? What are the issues? Are there competing interpretation of what is the issue?

Readings case studies (cont)


What are the facts?
Problem of missing information Problem of partial knowledge

Can you believe what you read?


Case writers partial knowledge Involvement of case writer

Why use cases?


Because they help develop certain skills
Analytical skills Application skills Creative skills Communication skills Social skills Self analysis

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