Business
Ethics – Discussion Project – Market failures?
Return again to your case.
This time:
1.
See if
you can identify any of the features we have discussed that might undermine or
reduce the effectiveness of market competition as an incentive for people to do
what is ethically right.
Informational asymmetries?
Monopoly power?
‘External’ costs or benefits?
Artificial or distorted wants?
Inequitable distribution of resources?
2.
How serious do you think these problems are in
your case? Would they have the effect of
allowing the firm or its managers to ‘get away with’ abusing or exploiting
others without paying a cost in terms of the ‘bottom line’? If there is a potential negative impact on
the ‘bottom line’, how likely is it that this will be large enough and
materialize quickly enough to adequately motivate managers who see their only
duty as the maximization of profits (or of their personal wealth)?