SMG SM 131 Lecture 23: Ultimate edition (Autosaved)

• School: Boston University
• Department: School of Management
• Course: SMG SM 131
• Professor: Kabrina Chang

Document Summary

Incentives may lead people to do damaging things. Today you can not go to bed until you are done with sm131 completely. As long as you follow the rules, only goal is to make a profit. Ceo has fiduciary duty to stockholders (agent of stockholders - ceo has obligation to them to increase value of stock) If you do something stockholders don"t believe in, then you are wasting their money: only have social responsibilities as a person (using own money and time) Real virtue of business is that it forces people to be responsible for their own actions. Government"s job to deal with social issues (*) Milton friedman: the social responsibility of business is to increase its profits. It is not responsabilitu of business to deal with social issues- The idea of business having a market responsibility harms the foundations of our free market system; entering something closer to socialism.