Using the rational-actor paradigm in this way—to change behavior by chang- ing incentives—makes some students uncomfortable because it seems to deny the altruism, affection, and personal ethics that motivate most people. These students resist learning the rational-actor paradigm because they think it im- plicitly endorses self-interested behavior, as if the primary purpose of econom- ics were to teach students to behave rationally, optimally, and selfishly. These students would probably agree with a Washington Post editorial, “When It Comes to Ethics, B-Schools Get an F,”1 which blames business schools in general, and economists in particular, for the ethical lapses at FIFA, Goldman Sachs, and other organizations. A subtle but damaging factor in this is the dominance of economists at business schools. Although there is no evidence that economists are personally less ethical than members of other disciplines, approaching the world through the dollar sign does make people more cynical. What these students and the author, a former Harvard ethics professor, do not understand is that to control unethical behavior, we first have to un- derstand why it occurs. When we analyze problems like the one at OVI, we’re not encouraging students to behave opportunistically. Rather, we’re teaching them to anticipate opportunistic behavior and to design organizations that are less susceptible to it. Remember, the rational-actor paradigm is only a tool for analyzing behavior, not advice on how to live your life. It is also important to realize that these kinds of debates are often de- bates about value systems.
Deontologists judge actions as good or ethical by whether they conform to a set of principles, like the Ten Commandments or the Golden Rule. Consequentialists, on the other hand, judge actions by their consequences. If the consequences of an action are good, then the action is deemed to be good or moral. We illustrate these contrasting value systems with a story about price gouging.2 When Notre Dame entered the 2006 season as one of the top-ranked football teams in the country, demand for local hotels during home games rose dramatically. In response, local hotels raised room rates. According to the Wall Street Journal, the Hampton Inn charged $400 a night on football week- ends for a room that cost only $129 on non football days. Rates climbed even higher for games against top-ranked foes. For the game against the University of Michigan, the South Bend Marriott charged $649 per night—$500 more than its normal weekend rate of $149. On a campus founded by priests of the Congregation of Holy Cross, where many students dedicate a year after graduation to working with the underprivileged, these high prices caused alarm. The Wall Street Journal quotes Professor Joe Holt, a former priest who teaches ethics in the school’s executive MBA program, “It is an ‘act of moral abdication’ for businesses to pretend they have no choice but to charge as much as they can based on supply and demand.” The article further reports Mr. Holt’s intention to use the example of rising hotel rates on football weekends for a case study in his class on the integration of business and values. Deontologists like Professor Holt would object on principle to the prac- tice of raising prices in times of shortage.3 We might label this the Spider Man Principle: with great power comes great responsibility. The laws of capitalism allow corporations to amass significant power; in turn, society should demand a high level of responsibility from corporations. In this case, while property rights give a hotel the option of increasing prices, possession of these rights does not relieve the hotel of its obligation to be concerned about the conse- quences of its choices. A simple beneficence argument might suggest that keep- ing prices low would be better for consumers. Economics, on the other hand, gives us a consequentialist understanding of the practice by comparing high prices to the implied alternative. An econ- omist would show that if prices do not rise, the consequence would be excess demand for hotel rooms. Would-be guests would find their rooms rationed, perhaps on a first-come, first-served basis. More likely, arbitrageurs would set up a black market, by making early reservations, and then “selling” their reser- vations to customers willing to pay the market-clearing price. Not only would consumers end up paying the same price, but these “arbs” would make money that would have otherwise gone to the hotel. Without the ability to earn addi- tional profit during times of scarcity, hotels would have less incentive to build additional rooms, which would make the long-run problems even worse!
Versions of this debate—between those who criticize business on ethical grounds and those who are trying to make money—have been going on in this country since its founding. Although a full treatment of the ethical di- mensions of business is beyond the scope of this book, many disagreements are really about whether morality should be defined by deontology or conse- quentialism. Once you realize that a debate is really a debate between value systems, it becomes much easier to understand opposing points of view, and to reach compromise with your adversaries. For example, if the government were considering price-gouging laws that made it illegal to raise prices on football weekends, a solution might involve donation of some of the profits earned on football weekends to a local charity. This might assuage the concerns of those who ascribe to the Spider Man principle. As a footnote to this story, when someone offered our former priest $1,500 for his apartment on home-game weekends, he took the offer and now spends his weekends in Chicago. Apparently, his principles became too costly for him.
There is growing concern about poverty and income inequality. These two concepts, however, are not the same. Income inequality deals with the percentage of income earned by the different income groups, while poverty is concerned with how difficult it is for the poor to meet basic needs. In Section 1.4, you read about deontological and consequential approaches to ethics. Using those approaches, evaluate how well free market systems versus government intervention in markets address poverty and income inequality. Include in your discussion an explanation of how people in a free market economy, acting in their own self-interest, can better those around them. Bring examples from your own experiences In (Japan) where your actions, though entirely self-motivated, resulted in a benefit to somebody else.
We aim at 100% customer satisfaction. As such, we never compromise on the quality of our assignment services and strive to maintain the highest standards of work for all our clients. Our writers craft each paper carefully to match the requirements on the instructions form while at the same time being surgical and objective while handling client work.
We receive many applications from writers around the world daily. Nevertheless, we only choose the cream of the crop to tackle your “help with homework” requests. Hence, our homework helpers are highly-qualified individuals who adhere to our quality policy.
We maintain a fair pricing policy for all our homework help services. Our pricing system generates quotations based on the requirements of each paper. Hence regardless of the complexity or duration of a paper, our system determines the most accurate and pocket-friendly price for all our clients.
At MyHomeworkWriters, we guarantee all students swift delivery of their assignments. We understand that time is an essential factor in the academic world. We, therefore, ensure that all assignments are delivered on or before the agreed deadline. This leaves room for editing to incase the client wants changes done to the work delivered by our writers.
We maintain a zero-plagiarism policy in all our papers. Our writers stick to the instructions to deliver plagiarism-free work. Other than that, they extensively research the work they are handling and are keen to avoid any chance of similarities with previously written papers. Our editors check every completed work to ascertain it’s at the set standards.
Our main objective is to assist you through every step of your academic journey. Thus, we completely understand that you might run into trouble once in a while when interacting with our system. If you do run into trouble, please get in touch with our support agents and they will immediately provide you with assistance. Feel free to contact us via the Chat window or email us.
Follow these simple steps to get your homework done
Fill in the order form and provide all details of your assignment.
Choose the payment system that suits you most.
You will be able to track the progress of your paper from our system.
Once your paper is ready, we will email it to you.
Myhomeworkwriters holds a reputation for providing high-quality assignment writing services. You only need to give us all the requirements for your “do my homework” order, and our writers will give you the best results.
Our team is skilled and equipped in searching for information required to complete work handed over to them. Regardless of the complexity of the work, we are determined to get the job done. Extensive research when handling client requests makes it possible for us to be able to stick to the boundaries and guidelines set by the clients. Thus enabling us to keep the work original and plagiarism free.
We have highly qualified writers to assist you whenever you place in "help with my homework" order. Our essay writing service is designed to not only help students get good grades but also excel in their studies. Our writers are highly experienced and educated specialists and professionals who want to do more than creating a difference in the academic field.
Our editors have a keen eye when going through work. They can capture even the smallest of errors. This has been made possible by the fact that we have been in the academic field for more than 5 years now. Thus, they bring with them previous experience when going through work to be able to capture everything. These unique skills make it possible for us to deliver error-free work to our clients.
Our team has very experienced specialists and professionals. This gives us a competitive edge over our competitors. Whenever we receive work that needs to be redone, everyone gets involved. That’s inclusive of our editors. This collective involvement in doing work makes it possible for us to deliver high-quality work to all our clients. Other than that it makes it possible for us to adhere to our originality and plagiarism-free policies.