Two Basic Perspectives Flashcards
(46 cards)
The Divided Mind
We like: low prices, high stock market values, infinite choices as consumers (we have never had it so good), we don’t like the outcomes
Others want to live just like us:
- three planets to house the waste
- meat consumption contributes to climate change more than extractive industries
What contributes more to climate change, meat consumption or extractive industries ?
Meat Consumption
How many planets does it take to house our waste?
3 planets
What is a business?
The collection of a private, commercially oriented organization ranging in size from one-person proprietorship to corporate gains
What is a society?
A community, nation, or a broad group of people with common traditions, values, institutions, and collective activities
The business role
100 countries and corporations with the highest annual revenues in 2014: 63 are corporations and 37 are countries
The business role, economies
51 are corporations and 49 are countries
What is Ethical Egoism
Persons ought to act to promote their own interests
The invisible hand
each customer is free to choose what to buy and each producer is free to chose what to sell and how to produce it… this will lead to a fair price and distribution of products that will benefit the community as a whole
Effects of The Utility of self- interest
- efficient methods of production will be adopted to maximize profits
- low prices charges to undercut competitors
- investors will only invest in industries that have maximum returns and withdraw from capital that have create lower returns
- students are prepared for the most needed, and lucrative careers
- all these effects will take place DYNAMICALLY and AUTOMATICALLY
What is a pluralistic society?
A diverse society that is accepting of all different kinds of beliefs, even if it’s not what they believe in
Pros to a pluralistic society?
- prevents power being concentrated in the hands of a few individuals
- maximized freedom of expression and action, strikes a balance between monism and anarchy
- provides a built in check and balance in such that groups can exert power over one another without being dominate or overly influential
What’s an example of a pluralistic society?
GM being a big flee provider in China, reason they continue to do so well
What does beware the “Sorcerer’s Apprentice” mean?
- Smith recognizes that the the invisable hand is not wrong, however some government actions might be needed.
What are the three Laws Smith says is needed under the Beware “sorcerer’s Apprentice?
- Antitrust laws
- Property rights
- Provide policing and national defence
What is a market failure?
When a market is left to itself and fails to allocate its goods and services efficiently. Policy makers allege market failures and call for an intervention
What happens when individuals pursuit their self-interest in a society leading to bad results for the society as a whole?
Market failure
Reasons for market failure?
- Conflicting demands
2. Environmental mishaps
What is an environmental mishap?
environmental accident? Market didn’t prepare for the consequences
Four reasons for a market failure
- Abuse of market power
- firms did not take into account the economic impact on outsider ( i.e. pollution )
- incomplete/ asymmetric information or uncertainty
- Public good, such as national defenses, how much would the market provide if it was up to them? NOT ENOUGH?
Define negative externalities
side effect or by product of actions that were not accounted for in the standard accounting system
- The actions of individuals have impacts on others that don’t pay or not compensated for - environment and social
Examples of negative externalities
- the market will produce too much pollution themselves
- exploitation of natural resources
- market themselves will produce too little research information
Define “tragedy”
a stress
Define “ the Commons”
- Living in the Commons is a “continual stress”
- The commons is a shared resource that a group of people use collectively
