Study Guide Test 1* Amartya Sen- Does Business Ethics Make Economic Sense?

Flashcard maker : Lily Taylor
The question that people usually ask is?
whether business can be morally good.
Amartya Sen knows that many people are inclined to think?
that business ethics does not make economic sense
Why do people think business ethics does not make economic sense?
because they have been influenced by a famous example found in the writings of Adam Smith.
Adam Smith
was one of the earliest writers who attempted to formulate a science of economics.
Today, many people have heard of Adam Smith’s analysis of?
the motives people have when they exchange things.
Does the example of the butcher, baker, and brewer support the conclusion that business ethics makes economic sense?
Yes
In exchanges, people may be motivated by?
self interest, or by the good of others, or by the avoidance of harm to others.
At the time Sen wrote this article, Japan and other East Asian countries were enjoying?
economic success.
Sen has other arguments about whether economic production can fully achieve its purposes without relying on morality. The most familiar examples involve?
producing things that we consume as individuals, such as detergent, candy, vehicles, etc.
The bad effects of the smoke are outside of the market, and so economists would describe them as?
“externalities.”
failures of resource allocations examples?
The market fails to supply public goods. The market also lets companies produce bad externalities.
When businesses are carrying out their own stated purpose, they are?
supplying all of the products and services that consumers demand, at prices that consumers are willing to pay.

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