Business Government and Society - Unit 3 Lecture 1
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Questions and Answers

What is the primary characteristic of the Market Capitalism Model?

  • Business operates independently from market forces
  • Businesses respond primarily to economic forces (correct)
  • Complete government control over production
  • All economic decisions are made by consumer consensus

    • Which of the following is NOT a value associated with capitalism?

  • Government monopoly on trade (correct)
  • Free competition
  • Profit motive
  • Private ownership of means of production

    • What is the primary focus of the Business-Government-Society field?

  • Promoting corporate profitability above all else
  • Analyzing government policies exclusively
  • Studying environmental impacts of business activities
  • Understanding the relationships between business, government, and society (correct)

    • What role does market economy play according to the Market Capitalism Model?

    <p>It promotes trading beyond subsistence production</p> Signup and view all the answers

    Which of the following is NOT considered one of the basic components of society?

    <p>Government policies</p> Signup and view all the answers

    According to Adam Smith, what encourages individuals to produce more?

    <p>Incentives of earning more</p> Signup and view all the answers

    What role do managers play according to the social contract between business and society?

    <p>They must respect and adhere to society’s expectations</p> Signup and view all the answers

    Which assumption is part of the Market Capitalism Model?

    <p>Individuals can own private property and risk investments</p> Signup and view all the answers

    What potential negative outcome does the Market Capitalism Model warn against?

    <p>Inefficiency from protecting particular producers</p> Signup and view all the answers

    Which model emphasizes the interaction of various forces impacting business decisions?

    <p>The Countervailing Forces Model</p> Signup and view all the answers

    In the Market Capitalism Model, which of the following is inaccurate?

    <p>Consumers are completely uninformed about prices</p> Signup and view all the answers

    Why is understanding the business power in society important for managers?

    <p>To align business practices with societal expectations</p> Signup and view all the answers

    What aspect of corporate behavior does corporate social responsibility encompass?

    <p>Ethical duties towards society and the environment</p> Signup and view all the answers

    What concept does the Market Capitalism Model emphasize regarding social welfare?

    <p>Markets discipline private economic activity to promote it</p> Signup and view all the answers

    Which definition best describes an 'institution' in the context of the Business-Government-Society field?

    <p>A formal pattern of relations that links people to achieve a goal</p> Signup and view all the answers

    What is the importance of defining basic terms in the Business-Government-Society lesson?

    <p>It ensures all participants have a common understanding</p> Signup and view all the answers

    What is considered the primary measure of corporate performance?

    <p>Profit</p> Signup and view all the answers

    What does the Market Capitalism Model presume?

    <p>Perfect competition exists</p> Signup and view all the answers

    What is a key criticism of the dominance model?

    <p>It allows corporations to evade responsibility</p> Signup and view all the answers

    What political movement arose in response to the dominance model's criticisms?

    <p>Populism</p> Signup and view all the answers

    According to the dominance model, what do corporations often do to gain influence?

    <p>Buy politicians</p> Signup and view all the answers

    What ideology emerged alongside the dominance model advocating for workers?

    <p>Marxism</p> Signup and view all the answers

    What is a consequence of increased prosperity as highlighted in the content?

    <p>Decreased public goods</p> Signup and view all the answers

    What does the content suggest about government regulation concerning the dominance model?

    <p>It is often ineffective</p> Signup and view all the answers

    What does the Countervailing Forces Model suggest about power in society?

    <p>Power fluctuates among major elements based on various factors.</p> Signup and view all the answers

    Which statement best describes the nature of power in the Countervailing Forces Model?

    <p>Power is a result of the interaction of multiple competing forces.</p> Signup and view all the answers

    In the context of the Stakeholder Model, who is considered a primary stakeholder?

    <p>Any entity that affects or is affected by the corporation's actions immediately and powerfully.</p> Signup and view all the answers

    How does the Stakeholder Model view the relationship between a corporation and its stakeholders?

    <p>The welfare of each stakeholder is an ethical concern for the corporation.</p> Signup and view all the answers

    What is a key difference between primary and secondary stakeholders?

    <p>Primary stakeholders have a stronger and more significant relationship with the corporation.</p> Signup and view all the answers

    What must businesses do to maintain broad public support according to the Countervailing Forces Model?

    <p>Adapt to various social, political, and economic forces.</p> Signup and view all the answers

    What advocacy is made for corporations that adopt the Stakeholder Model?

    <p>They are likely to perform better overall.</p> Signup and view all the answers

    Which of the following factors can influence the power of elements in the Countervailing Forces Model?

    <p>The intensity of competing interests and leadership influence.</p> Signup and view all the answers

    Study Notes

    Unit 3: Lecture 1 - The Study of Business, Government, and Society

    • The objectives of the lesson include defining basic terms, discussing the field's importance to managers, and introducing the four basic models of the business-government-society relationship.
    • The recommended textbook for this section is "Business, Government, and Society" by John F. Steiner and George A. Steiner. The 12th edition is referenced.
    • Definitions of key terms related to the Business-Government-Society (BGS) field:
      • Business: Profit-making activity providing products and services to satisfy human needs.
      • Government: Structures and processes that authoritatively create and enforce policies and rules.
      • Society: A network of human relations characterized by ideas, institutions, and material things.
      • Idea: An intangible object of thought.
      • Value: An enduring belief about correct life choices.
      • Ideology: A bundle of values forming unique worldviews.
      • Institution: A formal relationship structure to achieve a shared goal.
      • Material Things: Tangible artifacts shaped by ideas and institutions.
    • Importance of BGS to managers:
      • Understanding the role of business in society
      • Awareness of business power within society
      • Utilizing BGS considerations for managerial decisions
      • Evaluating the extent of corporate social responsibility
      • Understanding ethical duties of managers
      • Recognizing the need for regulations in this field
      • Successfully achieving business objectives
      • Excelling in managerial performance
    • Institutions support markets in ways shown in diagram
    • The Social Contract emphasizes basic agreement between business and various social groups
    • The duties described in this contract can be ambiguous
    • Four models for business-government society relationships are:
      • Market Capitalism Model
      • Dominance Model
      • Countervailing Forces Model
      • Stakeholder Model

    Market Capitalism Model

    • Depicts business as operating within a market, responsive to economic forces
    • The market acts as a buffer between business and non-market forces
    • Crucial to understanding the market itself for perspective on this model
      • Adam Smith, "The Wealth of Nations"
      • Concepts of Capitalism and managerial capitalism
    • Key elements for market interaction include buyers, sellers, and the price mechanism
    • In market capitalism, the proper measure of corporate performance is profit
    • The ethical responsibility of managers should be directed toward shareholders
    • Criticized as supposing perfect competition, causing increased inequality, posing a threat to ethics, failing to produce public goods, potentially leading to environmental damage, and encouraging push towards government regulation
    • Underlying assumptions include market regulation, individual private property rights, consumer rationality, moral restraint, and the existence of basic institutions for commerce
    • A corporation in this model disciplines private economic activity with emphasis on social welfare

    The Dominance Model

    • Business and government are dominant forces affecting society
    • This model portrays businesses and powerful elites controlling a system that benefits the few at the expense of the many
    • Focuses on deficiencies and inefficiencies in capitalism
    • Corporations are insulated from pressures that would hold them accountable
    • Weak government regulation

    The Countervailing Forces Model

    • Highlights exchanges of power among societal elements, acknowledging no enduring dominance
    • A model of multiple forces in interplay
    • A constant interplay among societal forces
    • Power of individual elements might fluctuate based on the issue at hand
    • Recognizes the power of opposing forces
    • Business is deeply integrated into an open society, responding to economic and non-economic forces
    • Business initiates changes via its use of technology, government interaction, and market activity
    • Business must adapt and respond to societal forces to get public support

    The Stakeholder Model

    • Ethical management considering the welfare of stakeholders as an ultimate aim
    • Stakeholders are entities impacted or capable of impacting the corporation either directly or indirectly.
    • Primary and secondary stakeholder categories are defined
    • This model debates how to identify who/what is a stakeholder
    • Model's critics express that it lacks clear assessment of relationships and objective measurement for evaluating ethical and economic performance.

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    Description

    Explore the key concepts of the business-government-society relationship in this quiz. Learn essential definitions, the importance of this field for managers, and the four basic models. This material is based on the 12th edition of 'Business, Government, and Society' by John F. Steiner and George A. Steiner.

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