PHIL 322 Lecture Notes - Lecture 17: Pareto Efficiency, Stakeholder Theory, Market Failure

• School: University of Arizona
• Department: Philosophy Main
• Course: PHIL 322
• Professor: ALL

Document Summary

Don t have oath for business managers because no code of conduct/ ritual that drives home seriousness of violating of rules. Stakeholder theory as capitalism working well - like a theory of good sportsmanship in business practice. Stakeholder theory is the theory business managers have as business managers - its a role- specific theory. Contrast between personal ethics and role specific ethics. Multi-fiduciary theory - business managers have fiduciary obligation to shareholders employees et. Markt failure approach - forms should contain their profit seeking when doing so leads to generation of market failures. Heath wants to make an alternative to stakeholder theory using market failure approach. A market failure is any situation that prevents a competitive market from being pareto efficient. A market distribution is pareto efficient when there is no trade that makes at least one person better off without making someone worse off. Pareto efficient - exhausted all gains from trade.