Difference Between Calkins And Friedman Essay

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According to Calkins and Jonathan Wight, first key criticisms toward Milton Friedman was about the description of the business manager role as to maximize profits for shareholders which is the CEO moral obligation. Calkins and Wight express their opposition to Friedman idea of narrowing the whole managerial concept on to maximizing profits because, profits play a big role in the market system in references to consumer’s preferences which is different from Milton Friedman concept. On Friedman point of view: There is a moral foundation required for a stable society and “Managers are to make as much money as possible for their owners and avoid other activities that reduce shareholder profits”. As it is emphasizes by M. Friedman: …show more content…
If the first customer vehicle last a period of time greater than the other one, it means that the first customer won and the seller lost because if the seller knew about the vehicle life cycle, he will sell it for more and it is vice-versa which demonstrates that Companies that are making profits are not cheating the system but are putting effort into the market analysis in order to generate their profits. The criticism that seems to be the most telling is about Friedman favorite quote “There is one and only one social responsibility of business which is to increase their profit”. Yes I will defend Milton Friedman who wrote this article in 1970. In fact the Author Arrow and Wight are misquoting and simplifying just one part of Mr. Friedman’s quote. According to Milton Friedman” A Corporate responsibilities is to make much money for the stockholders “and there was no effective care about child labor neither the workers’ health nor pollution. Indeed Corporate responsibilities in regard to the society was not as it is today. On his view, manager’s responsibilities are to always act in the shareholders interest and desire, but never, on the interest of the workers and we have to understand that it was 1970 the era of production as he cited Adam Smith in his …show more content…
Profit is easier to quantify instead of the worker happiness and “Corporate executive to be selected by the stockholders means that the CEO is an agent serving the interests of his principal”. It is easily understandable in1970 time frame that Friedman was a socialist and he was just reminding corporate Manager about his vision. “The difficulty of exercising social responsibility illustrates of course, the great virtue of private competitive enterprise. It forces people to be responsible for their own actions. During the 1970 we have to admit that Milton was right about his writing, the only social responsibilities of the Corporate was to make profit for shareholders. Reason why Mr. Friedman argues that a corporation, unlike a person, cannot have responsibility because no one will get in business with a corporate if they realize that the corporate cannot pay its bills.” Only people can have responsibilities” and “presumably, the individuals who are to be responsible are the businessman”.so for that reason, Corporate should have a moral responsibility which is integrity and Ethics we are studying today. There are other rules that businesses must adhere to if they wish to be successful; such as the obvious rules of the marketplace including supply and demand. In addition, as we have seen with the proliferation of ‘new’ technologies, the law usually

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