ADMS 1000 Study Guide - Final Guide: Domestic Violence, Liquor Control Board Of Ontario

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Published on 6 Feb 2013
Q 1. Third paragraph helps you save your answer: “…willing to give up high annual
profit and social responsibility for one time infusion of money.”
Wrong to privatize. Because it would cause mass production and economies
of scale, privatization would cause more publicity of alcohol and encourage
Privatization would raise profits with mass production and more sales, with
more going to the government, not the taxpayers.
Could lose its brand appearance and change as a company, which will
At the moment it is a controlled substance and there is accountability with
the government being responsibility. Privatization would not secure that and
the government will incur a huge loss.
Company’s would be allowed to sell different alcohol at different strengths
Could lower the value of the alcohol an increase criminal activity
Could lose out from outsourcing and would impair the economy: could
increase unemployment, health care costs, domestic abuse
Prof answer:
Crown corporations want control.
You need to protect society from alcohol abuse; governments job
Government needs to generate revenue for social programs and
public activities, sometimes not sought after by private companies
Support Ontario wines
If we privatize:
The image is that they are large, sloppy and beaurocratic, and in turn
become costly and inefficient. The thought is that privatization will
solve this problem.
They are also poorly managed, and cannot compete in the free market
[economic argument]
Privatization increases innovation, efficiency, sales and competition
Other perspective:
Is the LCBO run inefficiently? Does it need bailouts?
It makes a lot of money; the case gives us the information that it’s not
mismanaged and non-profitable.
It can continue on its own-doesn’t fit the profile of a mismanaged company
that needs privatization
[learned this from looking at other products]
Looking at the tobacco industry we can see that this has a high chance of
abuse- like the tobacco industry it was heavily advertised to bring
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