Sustainable Management Futures - Essay Example

This issue raises a number of specific questions regarding ethics and morality. Discussion There are a number of considerations when evaluating the ethics and morality of the free market. Classic economic theory rooted in Adam Smith largely painted free market economics not only as an ethical and moral system, but as the necessary processes that occurred during transactions (Scott 2004, p. 34). Smith’s ‘invisible hand’ posited that the invisible hand of the market would, eventually rectify supply and demand factors, as well as immoral business practices (Scott 2004, p. 34). While to an extent it’s clear that modern economic systems abide by Smith’s invisible hand of the market, there are further ethical and moral constraints that are not entirely articulated by Smith’s theory.

From an overarching perspective one of the prominent criticisms has emerged from 19th century thinker Karl Marx. Marx not only criticized the free market, but the entirety of the capitalist system (Scott 2004, p. 70). This perspective considered that capitalist operations resulted in the increased exploitation of workers. In this sense, the very notion of ‘profit’ is the extraction of value from the employee’s portion of work. . In the modern Western world one of the most prominent examples of this occurred with Standard Oil who had consolidated the petroleum industry in the 20th century; this organization was later divided into smaller subsidiaries as a means of allowing for increased competition (Shaw 2009, p. 45). There is the recognition that if the government was to allow unhinged capital expansion and the development of monopolies and oligopolies then there would be a corresponding increase in prices.

Without competition businesses have no motivation towards lower prices. Strictly speaking this perspective eschews traditional notions of the free market as operating without government regulation. This recognition then would simply posit free market economics as an unethical system as it limits fair competition. Another prominent consideration within the ethics and morals of the free market system are considerations related to the environment and social welfare. In terms of the environment many industries have a potential considerable impact on environment sustainability.

Most prominently one recognizes these industries with petroleum companies that have been involved in costly oil spills or other processes of environmental degradation. Another prominent consideration involves companies that produce high amounts of pollutants. Notably, in regions such as China such pollution has resulted in considerable degradation to the skyline and available oxygen (Mathews 1997; Gray 2006; Gray 2002). Finally, there is the consideration of wage rates. Most prominent in emerging economies such as China, but also in the developed world, are concerns related to factory labor.

Replete with poor wages and long hours these