Morality, competition, and the firm: the market failures approach to business ethics. (2014)

“an exciting thesis… to derive business ethics from the pursuit of market efficiency, rather from everyday morality.”

Joseph Heath, Professor in the Department of Philosophy as well as the School of Public Policy and Governance at the University of Toronto

Oxford University Press, 2014

A collection of essays providing “a compelling new framework for thinking about the moral obligations” of business – a ‘market failures’ approach to business ethics” (publisher’s description).

“Rather than bringing moral concerns to bear upon economic activity … (he) articulates a robust conception of business ethics derived solely from the basic normative justification for capitalism.”

Reviewing the book for Notre Dame Philosophical Reviews, Andrew Gustafson comments that Heath “roots business ethics not in controversial political or moral notions of egalitarianism … but rather, by determining the conditions which would lead to Pareto-optimal market efficiency – a state where no person’s situation can be improved without harming someone else’s situation.

“Heath’s list of ‘proper business’ rules may be common to many business ethicists, but the difference here is that if you ask “why should I follow these imperatives?”

“Heath’s answer is not rooted in rights, fairness, the greatest happiness principle, social justice claims, or the categorical imperative. He … finds the source of these ethical imperatives in the market itself – the market will work most efficiently when we help prevent market failures, and market failures happen because of … imperfections, asymmetries, and externalities.

“It is an exciting thesis – to try to derive business ethics from the pursuit of market efficiency itself, rather than to impose it from everyday morality, which may not always usefully apply to business.”

Access the book here: Morality, competition, and the firm

Read Andrew Gustafson’s review here: Morality, Competition, and the Firm_ The Market Failures Approach to Business Ethics __ Reviews __ Notre Dame Philosophical Reviews __ University of Notre Dame