Corporate Social Responsibility (CSR)

Corporate Social Responsibility (CSR) Chapter 1 Introduction Corporate Social Responsibility is a rapidly developing, key business issue. It is a concept that has attracted worldwide attention. Due to the demands for enhanced transparency and corporate citizenship, CSR started to embrace social, ethical as well as environmental challenges. Today, companies are aware of the social and environmental impacts of international production. It is accepted that Companies should not be only profitable, but also good corporate citizens. Through globalization of the economy, multinational companies are increasingly involved with suppliers and customers worldwide, especially if they operate in developing countries. The CSR agenda has a close relationship with international development. CSR within multinational companies is seen as a vehicle through which larger, well known corporations can contribute to the well being of developing countries by operating responsibly in terms of social and environmental issues. However, the promoted CSR in the developing world by multinationals is not real CSR, despite significant contribution to development in some cases. Very little is known about the companies CSR policies and practices in an international context, developing countries in particular. As reality shows, most of the larger corporations abuse the CSR and behave unethically and irresponsibly towards both society and the environment. Issues such as unsafe working conditions, unfair payment, gender discrimination, sexual h arassment, toxic emissions and the hazardous pollution of water and soil have all raised fair allegations by consumers, non-governmental organizations and the larger society. . Famous global brands like Nike, Coca-Cola, GAP and McDonalds are often under intense pressure from the public. Much of those pressures are due to their unethical behaviour in developing countries, where their main operations take place. Though companies operate in host countries, their reputation extends across numerous national boundaries. The actions of multinational companies in a host country can cause significant loss of reputation in the developed world, where the general public have become more sensitive to environmental issues and social impact. The public have the power to boycott the goods and products of multinational corporations in cases of unethical behaviour where organisations are thought not to fulfil their social and environmental obligations. However, international reputation side effects a re not the only reason behind the potential increased level of social and environmental responsibilities faced by multinational companies; there are many drivers for the correct implementation of CSR by business entities. However, for many companies, corporate reputation and brand image are the fundamental components of business success. Corporate Social Responsibility in developing countries represents the formal and informal ways in which multinational business enterprises contribute to improving the social, ethical and environmental conditions of the developing countries in which they operate. However, the rational approach to the CSR in the developing world is different from CSR in developed countries. For example, developing countries represent the ongoing growth of the economy; hence the most attractive growth markets for many foreign companies. They provide cheap labour, an absence of strong regulations and a rich availability of resources; all crucial concerns for multinational enterprises for conducting their businesses in developing world. It has been found that the public and the government are not as critical of unethical business practices within foreign companies. In addition, developing countries are where globalization, economic growth, investments and business activities are likely to have both posit ive and negative social and environmental impacts. Therefore, developing countries represent a different set of CSR agenda for multinational companies to those operating in the developed world. In this research paper the CSR practices of multinational corporations will be examined. Their CSR commitment as well as irresponsible practices will be highlighted. In the first chapter, there will be overview on the previous works in this field. As CSR is a new concept, especially in developing countries, the short history of the development of CSR and main contributions will be presented. Literature review will give us the background knowledge about CSR. In chapter two, research methodology and relating this to the subject matter will be discussed. As research will be based on case study, there will be some examples of multinational corporations experience in developing countries. The examples of their commitments towards environmental and social sustainability as well as negative impacts caused by their unethical operations will be provided. The opinions and critics of analysts and experts will provide a clear understanding of companies CSR practices in the developing world. The well known multinational companies like Nestle, Nike, KFC, Apple iPod and many others will be examined for their irresponsible and unethical behaviour in developing countries such as China, Indonesia, India, Southeast Asia and Africa. For the main research point the Coca-Cola crisis in India has been chosen, as Coca-cola, despite its CSR commitment towards society and environment, has caused damages to both the community and environment where it operates. From the case study, we are able to make some conclusions regarding CSR practices and make suggestions and recommendations for future of Corporate Social Responsibility, as it will undoubtedly increasingly become a major issue and integral part of business practise. Chapter 2 Literature review The 21st Century has seen much advancement in the issue of corporate social responsibility (CSR), and there has been particular interest in the impact CSR could have globally. This literature review will begin by defining what is meant by corporate social responsibility. There are a lot of debates about the origins of CSR; however it is clear that CSR is a modern term, a consequence arising from the history of business responsibility. The modern term is considered to have western origin; however it has developed from different countries ideas and theories. This has created a number of definitions of CSR. This can lead to confusion making CSR less effective. It is interesting to observe that none of the definitions actually defines the social responsibility of businesses, as so famously discussed by Milton Friedman (1970), but rather describe it as a phenomenon. The Government sees CSR as a business contribution to sustainable development. However, the modern concept of CSR has been i nfluenced by Globalization and so CSR has developed and is taken in different context worldwide. (Crane, Matten, Spence, 2008). In addition, organizations such as the European Union (EU) see CSR as a concept integrating social and environmental concerns in business operations and in their interactions with their stakeholders on a voluntary basis. However, others like Ethics in Action Awards (2003), describe CSR as a companys obligation to be accountable to all of its stakeholders in all operations and activities (Dahlsrud, 2006). There are a number of debates raised in academic literature over the issue of to whom the business must have responsibility. Various authors have referred to the common approaches: shareholder, stakeholder and societal approaches. According to shareholder approach, the classical view on CSR maximizing the profits of shareholders (Friedman, 1962). This approach can also be interpreted as being that the company should make contributions to the extent, to whic h it can be connected with the creation of long-term value for the shareholders (Foley, 2000). From the stakeholder theory, it is obvious that organisations should be accountable towards other groups of stakeholders, who can affect or be affected by a companys objectives (Freeman, 1984). The last approach, which is regarded to give the broader view on CSR, argues that the organisations should be responsible to societies as a whole, of which they are an integral part. The aim of the following literature review is to identify the most valuable academic studies and important practical investigations. The field of Corporate Social Responsibility can be divided into several parts; definitions of CSR, analysis of CSR approaches, CSR in supply chain, CSR in developed countries as well as in developing ones, the link between CSR and globalization and last, but not least the global understanding of CSR. The history of CSR The development concept of Corporate Social Responsibility (CSR) has been carried out mainly in western countries; particularly in United States. Literature picks up the issue from the 1950s when attention was devoted to the responsibility of businessmen ( Bowen, 1953) to the 1980s when the argument with stakeholder theory took place (Freeman, 1984) and of course, to the 1990s when most studies were devoted to the analysis of the relationship between CSR and corporate financial performance (Roman et al, 1999). In the beginning of the 1950s, Howard Bowen tried to give rational and systematic arguments in favour of CSR and its connection with big corporations and their influence on social consequences and undoubtedly, their primary societal responsibilities. The one of the earliest books on CSR, The Social Responsibilities of the Businessman, was written by Bowen in 1953. Bowens book was specifically concerned with the doctrine of social responsibility. Bowen argued that social responsibility is not panacea for all business social problems, but that it contains an important truth that must guide business in the future (Asongu, 2007). Because of Bowens early and very valuable work, Carroll has argued that Howard Bowen should be called the Father of Corporate Social Responsibility (Carroll, 2000). The decade of the 1 960s is characterized as seeing a growing interest in the formalizing or more precisely, defining the meaning of CSR. One of the prominent writers in this period was Keith Davis, who later extensively wrote about the topic in his business and society textbooks, later revisions and articles. He argued that social responsibility is a nebulous idea, but should be seen in a managerial context (Mahon, 1991). Another influential contributor to the early research into CSR was Friedman. The argument made by Friedman (1962) that the main corporations responsibility is toward shareholders has created much debate among academics. It was not until 1970, that Wallich and McGowan first made attempts to demonstrate the link between corporations social responsibility and shareholders interests. They argued that the aim of corporations long-term interest should be linked to the environment to which a corporation belongs. If society and environment became worse, a business would lose their critical s upport structure and customer base (Keim, 1978). In the 1970s there are a wide range of references, increasingly being made to corporate social responsiveness, corporate social performance as well as corporate social responsibility. In the 90s, literature tried to find out answers to questions such as why some companies are doing well and if CSR could be identified as a competitive advantage. Most academics and scholars started to apply the stakeholder theory to CSR, because stakeholders, other than shareholders have interest in the well-being of a company in relation to employees, customers, governments and others. This model renewed the interest in CSR and more research was devoted to this subject. Also, there is great interest in the linkage between CSR and corporate competitiveness; but bbbthere is a shortcoming of quantitative translation of socially responsible practices into specific results affecting the income and loss of particular organization (Murillo and Lozano, 2006). Many scholars connect CSR with the competitive advantage that a company can gain. The most well-known work in this field is Professor Michel Porters The competitive advantage of corporate philanthropy in which he describes how a company is able to improve its long-term potential by linking financial and societal goals (Porter, 2003). Further development in this area was made by Kramer (2003). Problems with CSR research We know very little about CSR initiatives and undoubtedly, there are some questions about both the efficiency of CSR approaches and the tangible benefits for stakeholder groups. Also, we know very little about the social and environmental impacts of CSR initiatives. For example, many business schools analyzed and devoted their works to studying the content of codes of conduct. They looked at specific issues such as child labour, but they failed to study the wider societal impacts of CSR. The most notable study about societal impacts came from development study scholars, not from business schools. The study by Barrientos and Smiths (2007) reviled that there are, in particular in those countries where empirical investigation took place such as South Africa, India, Vietnam and Costa Rica, some benefits from codes of conduct and initiatives implementing CSR by multinational companies. However there are failures in the areas of noncompliance and ensuring the improvement of working conditi ons. In addition to this, Barrientos and Smiths questioned the methods used by the business communities in investigating the societal impacts of CSR, doubting the efficiency of the tools used to monitor CSR performance. Due to the lack of empirical study and evidence regarding CSR impacts, there are still analytical limitations in the current CSR field. For example, some academics (Lantos, 2001) wrote about conceptualization of CSR, however, current field of CSR and business scholars fail to answer vital questions. For example, how can CSR tackle a development challenge like poverty, without an understanding of the negative influence caused by multinational companies operating in host communities? Even if there is agreement about societal benefits of CSR initiatives, there is still uncertainty about the way in which CSR should be studied and analyzed. Lockett, Moon and Wisser (2006) argued that CSR knowledge should be best described as a continuing state of emergence. Indeed, many s cholars study CSR initiatives without any reference to theoretical perspectives. Milton Friedman and other authors highlighted the agency problem of CSR for a long time. For example, Friedman argued that the pursuit of societal and environmental objectives will undoubtedly hurt shareholders by lowering profits. However, other scholars like Margolis and Walsh (2003) oppose the arguments of Friedman. They found that, between 1972 and 2002, at least 172 empirical studies investigated the positive relationship between social responsible behaviour of an organization and its financial performance. Levels of CSR Another main contribution to the development of CSR made by Carroll (1991), considered the economic, legal, ethical and philanthropic levels of CSR. These levels represent what is required, expected and desired for CSR strategies (Crane, Matten, Spence, 2008). According to Crane, Matten and Spence, Carrolls pyramid of CSR is the most widely accepted definition of CSR. Until the 1980s, environmental corporate responsibility was the part of social responsibility, which was used as a frame term that covered a wide field of ideas. However, corporations became to understand the importance of environmental responsibility. For this reason, the concept of corporate environmental responsibility has started to be used by researchers such as Rondinelli and Berry (2000) in parallel with the development of corporate social responsibility by Carroll (1998), Maignan and Ferrel (2000) and Zarkada-Fraser (2004). CSR and Corporate Social Reporting The great number of scholars, who have since the 1970s (Fenn, Ackerman,), analyzed the complex issue of Corporate Social Responsibility and the advantage of reporting on a wider scale, have given the possibility to evaluate social performance (Levis, 2006). The theme of social reporting has been developed along with the CSR. The approach for researching reporting is different in comparison with past decades due to the growing number of organizations that have published a social report. (Belal, 2002; Bitcha, 2003; Weaver et al, 1999). The reason for the growing interest in this field is linked to progress in business ethics (Donaldson, 1999) and the significant importance of the stakeholder approach, which has led to an increase of interest in studying the causes and real meaning of the phenomenon. The present approach to social reporting activities can be divided into two parts: fists, those who still think that it is a responsiveness approach and others, who argue that it is much mo re than communication; it is a tool of strategic management. Research in CSR worldwide Cultural differences affect CSR dynamics as well as companies practising responsible behaviour. For instance, research by Juholin (2004) reviled that long-term profitability is the prominent driving force behind CSR in Finland. Research by Fulop et al. (2000) discovered differences in CSR orientations between large and small firms. A similar study by Uhlaner et al. (2004) suggests a mixture of CSR perspectives (economic benefits, legal, ethical and philanthropic considerations) as useful in explaining variations in CSR orientations amongst Dutch firms. Despite cross-cultural and national differences, there are differences in the variety of methodologies adopted in examining and analyzing CSR. Some studies considered CSR as a philanthropic and ethical responsibility; however other studies have made a distinction between CSR as simple legal compliance vs. CSR as conducting business with high regard for morality. As noted previously, the debate about CSR has existed since the 1950s. In the first academic papers, a narrow concept of corporate social responsibility was used. Most of the authors like Bragdon and Marlin (1972) and Spicer (1975), tried to approach CSR through the main social and environmental problems such as pollution and contributions to the local community. The data used for their analysis was based on information issued by the Council on Economic Priorities. However they were not able to cover the whole aspects of CSR and their works were not valid for every industry (Dooley, 2004). Later, a broader valuation and examination was provided by Moskowitz (1972, 1975). In his work he tried to cover almost every aspect of corporate social responsibility such as equal employment opportunities, charitable contributions, fair dealing with customers, product quality and more. CSR in developing world Despite the great interest in ethical and responsible behaviour in business, very little is known of the practise of CSR in developing countries. For example, Belal (2001) notes that there are a wide range of academic publications, describing CSR in the context of developed countries such as Western Europe, the USA and Australia. Also that we still know too little about practices of corporate responsibility in ex-colonial, smaller and developing countries. He suggests doing more research into developing countries as it will give a valuable insight to the western meaning of CSR in context (Jamali, 2007). There are no large scale developmental studies of CSR in developing countries as there are in western countries. However, the CSR discussion traditionally revolved around the multinational companies operating in developing countries. The multinational companies response to CSR has great impact on the future global CSR agenda. The first notions of corporate social responsibility in developing countries emerged in the 1960s amongst American companies operating in developing countries, particularly in Asia and Africa. Perhaps a simple definition, truly reflecting the responsible behaviour of current multinational companies operating in developing countries is presented by Davies, who suggested CSR as a framework for the role of business in society. The implication of this definition is that it includes any society in which the company operates, including the global society (Engle, 2006). Within the Asian context, most academics paid attention to describing the governance aspects of environmental responsibility (Hong Kong: Hills and Welford; China: Bi; The Philippines: Forsyth). In contrast, in India, Mohan has focused on social responsibilities and corporate citizenships. Also, there is some research into the normative aspects of CSR such as the evolution of business ethics in Taiwanese companies (Wu). In the study of CSR in Malaysia, Teoh and Thong found that the most foreign multinational companies seemed more inclined to accept their responsibilities towards environment and society (Chapple, 2005). CSR in the Global Context CSR and multinational corporations. Relatively little is known about management of corporate social responsibility by multinational companies (Gnyawali, 1996). In general, little is known about the management of CSR in multinational companies, either practically or academically. While many areas of research have examined the nature of cultural or business preference to social equality (Adler, 1997; George and Jones, 2002; Lantos, 2002), there has previously been no research regarding the role of CSR in the expansion of organizations into new territories or cultures. The dominant theoretical approach to studying CSR practices among multinational companies, operating in developing countries, is the works of Bartlett and Ghoshal (1989) and Prahalad and Doz (1987), who tried to analyze general multinational companies management practices in CSR. This framework was then extended by Yip (1992) and Husted and Allen (2006) to cover CSR practices (Geppert et al., 2006). The studies of these researchers enabled interesting insights such as how CSR is being managed, the potential barriers to successful implementation of CSR practices within domestic p laces into operation among multinational corporations. However, mainstream research of CSR was concentrated particularly on domestic issues such as labour issues, racial discrimination, the position of women and the environment. To date there has been limited analysis in the developing countries context, in particular regarding foreign multinational companies. Further detailed analysis is needed of what instrumental, moral and relational motives exist in systems very different to the western context in which they were developed. CSR and Globalization With Globalization, CSR has been propelled into a global context. Ruggie (2004) identified three particular aspects of social responsibility in the context of global governance. Firstly, nowadays it is expected that multinational companies will build new capacities and take care of issues such as working conditions, healthcare and education as well as respect human rights. So that, if corporations insist on setting up in developing countries, they are forced to consider challenges, normally associated with developing countries like poverty or child labour. Nowadays, most multinational companies face a lot of new and challenging problems in this era of Globalization. According to Weber, Lawrence and Post, multinational companies are able to solve such problems. They have introduced the idea of Three sector world, compromising multinational companies, non governmental organizations and community. In their research, they compared both strengths and weaknesses of each sector and analyzed their contributions to solving global problems. The research method was based on comparing attempts of two multinational companies in implementing CSR in developing countries (Young, 2008). Based on their findings, it is obvious that a collaborative partnership with community and non governmental organizations can carry better results in implementing CSR. Therefore CSR in the global context involves more than business implementation, it needs business cooperation with other organizations whose focus is greater on CSR. From the vast majority of literature, it is clear that CSR has gained major significance in the era of Globalization and multinational companies should take responsibilities for their actions worldwide, especially in developing countries. Multinational corporations should behave as a moral leader in an area where there are no legal requirements (Scherer and Smid, 2000). CSR is considered a Western idea, which has now to be applied to problems in the developing world ( Scherer and Smid, 2000). The literature review is an account of what has been published on corporate social responsibility; it acknowledges the critical points highlighted by scholars and researchers. The literature review conveys what knowledge and ideas have been established on corporate social responsibility and it enables further research to compare and contrast these ideas in order to create new theories. Therefore a literature review provides the basis for the analytical framework of this research (Bryman, 2004). It has also helped with the interpretation of the results and has led to other questions being asked. The literature review also highlighted that there had been little research carried out on the societal impacts of CSR and implementation of CSR by multinational companies in developing world. This gives further importance and emphasis to the analysis of literature in giving rise to new questions and theories. The literature review has provided the framework of following deep research about cor porate social responsibility of multinational companies in developing countries, in particular the problems and benefits of implementing of CSR and the role of huge corporations in this issue. The literature review has helped to identify key themes within CSR by multinationals and from this more questions have evolved. Chapter 3 Methodology In this research paper the case study was employed as the research strategy. Usually descriptive or exploratory research is associated with the case study, and this might be particularly useful when the phenomenon under investigation is difficult to study outside its natural setting. Using case study research methodology is also helpful when the concepts and variables need to be considered where experimental or survey methods are regarded to be inappropriate (Yin, 1994). Case study is used particularly in looking at the specific questions such as how and why that is set in the contemporary environment (Yin, 1989) Case study methodology has a lot of advantages over some other methodologies. First, it allows the use of multiple data collection techniques in order to build a more comprehensive picture of the case being investigated. Second, this in turn leads to the ability to capture both qualitative and quantitative data. Case studies can provide a solid understanding required for hyp othesis development that then leads to improved theory development. The main advantage of case based research is that results are considered to be interesting and important and can shift the focus of investigation towards a new area of interest (Scapens, 1990). The case study is usually considered more accurate, diverse and rich, if it is based on several sources of data (Alasuutari, 2000). Advantages of using secondary data for research purposes As the research is concerned with multinational companies operating internationally, secondary data will probably provide the main source of necessary information. As our research strategy is case study, it is better to use compiled data that have already been sorted or summarised (Kervin, 1999). Secondary data can be obtained from different sources aimed at the same geographic area, where our case study takes place such as the Coca-Colas crisis in India. Area-based multiple sources of data are usually easily available in different forms, especially in published forms. Also tracking the original source of secondary data is much easier, especially when time restrictions are severe. As it will be a case study, it is even preferable to use newspapers, journals and media on a regular basis, as they may provide recent events within the business world. Research will concern the specific country i.e. India, data from government sources are also useful due to their high quality. Because of t ime constraints, secondary data can be obtained very quickly, in addition they have better quality standards in comparison with collecting own data (Stewart and Kamins, 1993). Using secondary data within collection also has a wide range of benefits, as they have already been collected and analyzed (Cowton, 1998). Unlike the data collected by myself, secondary data are permanently available and easily accessible, so that it can be checked relatively easily to others (Denscombe, 1998). Problems with collecting primary data for research purposes Access for some primary data can be problematic and difficult. Therefore it is unlikely that gaining permission for physical access will be easy and will be time consuming. As an interview is way for collecting primary data, however it is difficult to seek access to a range of participants such as employees, suppliers, customers and other stakeholder groups. The main cause might be restricted access to companys data either directly or indirectly (Bunchanan et.al., 1998; Raimond, 1993). As a full time master student, you are not able to have prior contact with huge multinational companies and you will be required to negotiate in order to gain any access to each level of information. Also, the major obstacle in obtaining primary data is time constrains. There is not sufficient time for all methods of collecting primary data, as physical access may take weeks or even months (Bunchanan et.al., 1998). Even, if there are time allowances, nobody can guarantee that replies will be quick and contain all necessary information. In case of opportunities for conducting interviews, undertaking questionnaires or engaging in observation, unfortunately, this would take several weeks. Whichever method will be chosen, almost all methods for gathering primary data are very time consuming (Bryman, 1988). However, due to the growing significance of the topic, many researchers have used primary data to conduct research. They collected primary data through interviews, observation and questionnaires. There are some examples of case study based research approaches. The implementation of CSR in developing countries was examined by Christina L. Anderson and Rebecca L. Bieniaszewska in the paper The Role of Corporate Social Responsibility in Oil Companys Expansion into New Territories. The aims of the study were to analyse the role of CSR in British Petroleums overall business strategy and to examin the benefits of employing CSR as a part of business strategy when it was operating in new territories and cultures. The case study approach was conducted through providing interviews with representatives from BP, social auditing and accounting specialists. Recent company reports and website information were also examined. Another example came from Richard Welford and Stephen Frosts research that provides an overview of CSR practices in Asia. The aim of the research paper is to review the benefits of the implementation of CSR in supply chains and arising obstacles. In order to collect data for research purposes, interviews were undertaken with six CSR managers working for well-known brand corporations, ten factory managers and eight CSR experts. Interviews were held confidentiality and anonymously. All participants have extensive experience of CSR issues and provide a good overview of the challenges for CSR by multinational companies in Asia. The case study based approach showed that multinational corporations such a

Discuss ethical considerations related to research studies at the cognitive level of analysis Essay

Discuss ethical considerations related to research studies at the cognitive level of analysis There are plenty of ethical considerations connected to research studies at the SCLOA, for example the right to withdraw, deception, knowledgeable agreement and excessive stress or harm. For example, Festinger’s â€Å"When Prophecy Fails† observation of a doomsday cult has ethical invasions of deception as well as knowledgeable agreement. Festinger and his group of researchers invade a doomsday cult that thought that the world would come to an end on December 21st and aimed to see how they would react when it wouldn’t end. By pretending to be one of them, Festinger violated the ethical thought of asking for their authorization and consequently, since it was a secret observation, he also cheated them. They were incredibly upset when he said who he really was; to be an undercover researcher. It is most likely that Festinger would not have been able to earn a full understanding of the cult’s behaviour and how it played into the social recognise theory if he had not cheated them, as he was observing them on their normal day without any effects influencing their behaviour. However, he cheated on ethics. This is a matter with other observations at this level of analysis as being secret that tricks them and is unethical if they aren’t in a public place, during undisguised influences their natural behaviour that is precisely what you are trying to study. Milgram’s study on people’s willingness to do authority also is an invasion of ethics in terms of cheating, but also with excessive stress or harm and even the right to withdraw. Members that participated were asked to ask a number of questions to someone they were only able to hear and to give a number of electric shocks every time the other person, who was normally only a tape recording, would give an answer to the question incorrectly. The voltage of the shock would be increased per incorrect answer. Although the members that  participated delivering the shocks weren’t able to actually hurt someone, they still became more and more stressed every time the person on the reco rding would sound more hurt or even stop saying something. The whole point of this experiment was to be able to see how far someone would go when carry out authority so some people, when forced by a calm researcher, would deliver shocks that were marked as lethal. When the experiment was over, the people who had done it all the way to the strongest shocks were questioned and told that they hadn’t actually harmed anyone. Nonetheless, they were still tricked and were stressed by the cries of pain or silence that showed that the person was dead. Moreover, the long-term effects of this study on the members that participated, is that they know that they are capable of hurting someone or even killing them, which may traumatize them. Nonetheless, the experiment was controlled, and so was artificial and lacked ecological acceptance. Also, it was done on other people who had sound like they had mental health problems, so this experiment can be easily generalized and used for the SCLOA as it studies how others influence one’s behaviour. As mentioned before, however, Milgram had some problems with the right to pull back, which Zimbardo’s â€Å"Prison Study† also had. Milgram made it able for people to leave if they became uncomfortable; nonetheless, his aim for this study made him to become more uncertain and made them continuously to stay. This is not the case with Zimbardo’s study. In his study, he randomly chose mentally healthy members that participated to the role of a prison guard or a prisoner to search the role of dispositional and situational factors in behaviour. Nonetheless, over the course of this study, Zimbardo and his members that participated became so involved in their roles that they were made to that not only the prisoners were humiliated, physically punished and felt violated and in danger, at some moments they were forcedly undressed and given a piece of clothing that covered little of their private parts; however, they weren’t able to be let out of the study. Only one member that participated with the role of a prisoner was released because of a severe state, but the others members that participated who screamed and cried to be released, couldn’t be released. On top of the excessive stress and harm inflicted on the prisoners and   guards, who might have been traumatized by their actions during this study, none of them could leave the experiment. The researcher was not Zimbardo himself, he became absorbed in his own role as the prison officer, and consequently he is biased when analysing his own study. Overall, this was an unethical study, even though; fortunately the members that participated were questioned and offered psychological counselling because of the long-term effects. It is obvious that deception, knowledgeable agreement, the right to withdraw and undue excessive stress or harm are ethical considerations at the SCLOA. It is frequently hard to keep away of such ethical violations at this level, though, as in order to study someones behaviour and how we are influenced by others in their natural state, the existence of a researcher may affect this behaviour. Therefore, questioning is important in sensitive ethically risky studies such as Festinger’s, Milgram’s and Zimbardo’s studies. However, when studying someone’s behaviour, a researcher must stay a secret, for example, not becoming affected by the group, and keep paying attention to the rights of the members that participate; being denied the right to withdraw has no excuse.

Classical Economics Essay

The neo-classical economics movement has been touted as the replacement to classical economics movement as it appeared to have been presented as an improvement to the beliefs and ideologies of that of the classical economics movement. Not many people agree with this fact as it stands though. While some think that the neo-classical movement represents an evolution of economic theory from the early and probably flawed version which was the classical economic theory to a more advanced, sophisticated and improved theory, others believe that the neo-classical movement represents the birth of an entirely new discipline that had decided to abandon a lot of the questions and issues that the classical economic movement had been riddled with instead of trying to find a better approach to arriving at reasonable solutions for those issues. As a result of these contrasting views, it is necessary to delve into the origins of both movements, carry out a thorough analysis of the modus operandi and arrive at a reasonable conclusion by taking a subjective stance on the matter. In doing this, some of the issues that will be addressed include: the specific issues that the neo-classical economic movement and the classical economic movement really address, how much overlap there is between the named set of issues, the kinds of analytical methods used in both economic movements, and whether the neo-classical analytical method is more effective at accomplishing its own goals as well as that of the classical economic methods (even better than the classical economists themselves). Classical Economics The birth of the classical economics movement is largely attributed to Adam Smith as a result of his 1776 publication titled The Wealth of Nations, although Jean-Baptiste Say, David Ricardo, Robert Thomas Malthus and John Stuart Mill (over a period of about hundred years) are all seen as the major contributors to the development of the movement (Evans & Phillips, 2006). Adam Smith laid emphasis on the fact that a perfect economy is self-regulatory in the sense that the needs of the population present in that economy are automatically satisfied. He coined the term ‘invisible hand’ as a mechanism that is responsible for the propelling of the populace to pursue their individual self-interests which indirectly promotes the general improvement of the society (Evans & Phillips, 2006). This emphasis served as the basic foundation of the classical economic movement. David Ricardo on the other hand, stressed that profits and wages were drastically affected by increase in the price of rent. The increase in rent according to Ricardo was as a result of the increasing population which is a consequence of the fixed availability of land (Evans & Phillips, 2006). Reverend Robert Thomas Malthus in his suggestion averred that unemployment in a market economy is caused by the economy being frugal with spending. However, he was more famous for his population theory that explains that food production increased at an arithmetical progression while population increased at a geometrical progression (Evans & Phillips, 2006). This implies that with time, the population will soon outgrow food supply and the limited amount of available which will result in diminishing returns to labor (Evans & Phillips, 2006). The diminishing returns to labor in turn leads to a radical reduction in the standard of living as a result of the low wages that workers are paid. John Stuart Mill’s proposition took into consideration, the fact that resource allocation and income distribution, which happened to be the two major roles of the market system were distinctive from each other and that the market may not be efficient enough to perform both roles therefore, the involvement of the society is required to compliment the inefficiencies (Evans & Phillips, 2006). The term ‘classical economists’, was first used by the father of communism, Karl Marx to describe the group of economists that shared the same beliefs regarding the labor theories of value. At a time when capitalism was gaining grounds at the expense of feudalism, and when the industrial revolution was rapidly restructuring the society, it was necessary to re-examine and re-define the status quo by ensuring that the nation’s economic interests as a whole lies in and is determined by market forces instead of the autocratic and individualistic determinants that were formerly widespread (Evans & Phillips, 2006). Since then, various classical economists, such as Samuelson Paul, Hollander Samuel, John Hicks, Kaldor Nicholas, and Luigi Pasinetti, have thoroughly studied how the wealth of a nation grows and how policies need to be implemented so that the nation’s wealth continually grows. In doing this, the aforementioned economists (Samuelson et al. ) basically presented various recognized models so as to define their own analysis of classical economics. A major contribution of the classical economists was the development of the labor theories of value whereby the market values of commodities are associated to the various labor efforts that is needed to produce them. These theories of value were largely attributed to William Petty, Adam Smith, and David Ricardo who were acclaimed to have developed them so as to suitably look into economic dynamics. In order to properly make the representation of the regularities found in prices easy, the classical economists brought about a basic distinction between market price which is largely affected by many short-lived influences which are not easily put forward at the theoretical level and natural prices of commodities which are responsible for taking into consideration, the continual forces that are operating at a given point in time (Evans & Phillips, 2006). As far as the labor theories of value are concerned (as seen especially by Adam Smith), when an individual purchases a commodity, the real value of that commodity as far as the individual is concerned, is the practical sum total of the exertion that the individual underwent in purchasing the commodity. In other words, the actual value of a commodity (from the consumer’s angle) lies in the labor that is expended in the acquisition process of the commodity. Also, the value of a commodity from a producer’s angle is the total stress or trouble that has been experienced in order to arrive at the finished product. This also implies that the actual value of a commodity (from the manufacturer’s perspective) lies in the labor that is expended in the production process of the commodity. The labor described above depicts that which does not involve a pleasurable experience in the sense that the individual (consumer or producer) does not conveniently or pleasantly go through the experience of acquiring or manufacturing the commodity. In this case, labor is seen as opposing to utility. As a result of this, the natural price of a commodity is determined by the summation of profits, wages and interests (from Adam Smith’s proposition), although this view differs between the classical economic thinkers’ community because David Ricardo, John Stuart Mill, and Robert Thomas Malthus all had varying concepts (though similar to an extent) about labor value of theory. The classical economic movement also addressed the issue of comparative advantage, especially David Ricardo. The principle of comparative advantage suggests that each nation should specialize in the production of the particular commodities that it can efficiently produce (Evans & Phillips, 2006). It should then seek to import every other commodity it needs. The implication of this is that the total output of the nations of the world would be more than if the nations decided to be more self-sufficient. This theory served as the foundation of the theory of international trade and immensely influenced the free-trade doctrine aspect of classical economic thought (Evans & Phillips, 2006). Classical economists also addressed the issue of the theory of distribution which proposed that the national product is divided between laborers, capital owners, and landlords. These three social classes share national products in the form of wages, profits, and rents, i. e. wages in the case of laborers, profits in the case of capital owners, and rents in the case of landlords (Evans & Phillips, 2006). It is therefore possible for one of the above-mentioned social class to achieve a superior allocation of the national product over the other social classes. There is hardly any common characteristic between the above mentioned issues that were addressed by the classical economists. The theory of comparative advantage is not related to the theory of distribution as well as the labor theories of value. Therefore, the issues cannot be said to be overlapping. The analytical method utilized by classical economists involves the historical-deductive method (Evans & Phillips, 2006). The economists that belong to the classical economic movement actually observe real life situations and then from their observations, they propose solutions to economic problems. The solutions arrive largely as a result of the fact that the observer has noticed a pattern and can then deduce a likelihood of such pattern occurring again based on the tendency of the pattern to repeat itself as had already been observed. A typical example of the historical-deductive analysis employed by classical economists is the input-output analysis. The technique behind this method involves viewing the raw materials of a production process as an input while the semi-finished or finished product is seen as the output (Evans & Phillips, 2006). Such semi-finished or finished product may be used as an input to another process which will result in a different output. In other words, the output of one industry is the input if another industry and this happens over and again when the economy is concerned as a whole. Neoclassical Economics The â€Å"Marginalist Revolution† was responsible for the introduction of the neoclassical economic movement. It was as a result of the theories of William Stanley Jevons, Carl Menger and Marie-Esprit-Leon Walras. Jevons reflected this theory in his 1871 publication titled Theory of Political Economy, Menger in his 1871 publication titled Principles of Economics, and Walras in his 1874 publication titled Elements of Pure Economics (Evans & Phillips, 2006). William Jevons’ concept of utility was largely influenced by the utilitarian principles of John Stuart Mill and that of Jeremy Bentham because of the integration of their hedonic conception in his works (Evans & Phillips, 2006). However, his view was different from those of Mill and Bentham on the grounds that value depends on utility among other things. He opined that the contentment or satisfaction derived from goods and services will always tend to reduce at the margin. For instance, the more cups ice cream an individual takes, the less pleasure such an individual derives from the last cup of ice cream until finally, the individual stops taking the ice cream. This principle is otherwise explained as the theory of diminishing returns. He also modeled his theories after mathematical principles found in mechanics thereby incorporating mathematics into economics. Carl Menger on the other hand, failed to agree with Jevons’ notion and did not embrace the hedonic conception that Jevons added in his own works. Instead, he tried to explain diminishing marginal utility in terms of an individual prioritization of the possible usefulness or uses of a commodity (Evans & Phillips, 2006). In other words, Menger posits that consumers will always act in a way that ensures that their satisfaction is maximized in all inclinations. In other words, consumers will always apportion their money in such a way that the last component of a good or service that they purchased generates no more satisfaction than the last component of another good or service that they purchased (Evans & Phillips, 2006). He also failed to embrace the incorporation of mathematics into economics as observed in the case of Jevons. Walras conversely was more focused on the market interactions within an economy and also had similar views with Menger on the concept of diminishing marginal returns. He was of the opinion that as small as the change in a consumer’s preference for a particular commodity might be, it would always affect the producer’s predilection to adjust production of such a commodity. For instance, a shift in the consumer’s preference from land phones to mobile phones results in the reduction in the price of land phones and a corresponding increase in the price of mobile phones. The producer or manufacturer as the case may be would shift production to mobile phones which will lead to increase in market supply thereby setting a new price equilibrium between both commodities. Although the trio of Jevons, Menger, and Walras were responsible for the originating the Marginalist concept of economics which birthed neoclassical economics, their works were not so popular until it they were popularized by Francis Edgeworth, Alfred Marshall, Philip Henry Wicksteed and Lionel Robbins (Evans & Phillips, 2006). These set of economists were called the consolidators while Jevons, Menger, and Walras were known as the revolutionaries. Although not very common, a few economists have been referred to as the main proto-marginalists. These less-notable economists include Antoine Augustin Cournot (1838), Jules Dupuit (1844), Johann von Thunen (1850) and Heinrich Gossen (1854) (Evans & Phillips, 2006). Their era preceded that of the revolutionaries, but it was not until when Jevons, Menger and Walras published their own works that the Marginalist concept came into the economics public enlightenment. Also, the popularity of the Marginalist theory did not end with the consolidators; there was this group of economists known as the Revivalists who further incorporated the Marginalist theories into their own work, thereby leading to further popularization of the concept (Evans & Phillips, 2006). The economists that belong to the ‘Revivalist movement’ include: John Hicks (1939, 1934), Harold Hotelling (1938), Oskar Lange (1942), Maurice Allais (1943), and Paul Samuelson (1947) (Evans & Phillips, 2006). In one way or the other, all the above mentioned economists had a major role to play in the origin of the neoclassical economic movement. Another peculiarity of the neoclassical community of economics is that there appears to be factions or different ‘schools of thought’. This was as a result of the independent nature of the pioneers. That is, Jevons was writing in England, Menger from Austria, and Walras from France. They were not aware of each other as at that time and as a result; different schools of thought developed thereby presenting the neoclassical economic movement as an embodiment of different schools. These schools include the Lausanne School, Vienna School, Paretian School, Cambridge School, to mention but a few (Evans & Phillips, 2006). The neoclassical movement as a whole tends to address the issue of marginal utility. Marginal utility refers to the ‘utility’ that is derived from an increase in the consumption of a particular good or service. It could also refer to the ‘utility’ lost from a decrease in the consumption of a particular good or service. It results in the concept of diminishing marginal utility previously described, that is, more utility is obtained during the first consumption of the unit of a particular commodity than is obtained during the second consumption and this occurs in subsequent consumptions. It is basically what the Marginalist revolution was about. While consumers of a commodity strive to maximize the utility derived from the commodity, the producers or manufacturers of the community also tend to maximize profit in the process. Apart from maximizing utility and profits, the neoclassical economic movement also addressed the issue of rational preferences. Every human behavior is guided by a rational reasoning. This implies that an individual will always tend to select that which appears to be appropriate as far as satisfying his or her needs is concerned. As a result, such an individual develops a preference for that good or service that would suitably be of benefit to them by comparing the costs and benefits of their actions. Another issue that was addressed by the neoclassical economists was the question of how people act on the â€Å"basis of full and relevant information† (Evans & Phillips, 2006). It was proposed that an individual acted independently on this basis because the more relevant information such an individual had on a particular product, the better the chances of maximizing utility. From the mentioned issues, it is evident that there is a kind of overlap between them. For instance, an individual that has a relevant information on a particular good or service is then provided with the choice of comparing the costs and benefits of acquiring such product or service. After comparing the costs and benefits, the individual chooses to either develop a preference for that product or some other favorable product in order to maximize utility. The analytical method utilized by neoclassical economists involves the hypothetical-deductive methods (Evans & Phillips, 2006). This method is more mathematical in nature thus leading to the neoclassical economists being accused of â€Å"mathematicalizing† economics. In order to observe the economic system for the sake of analysis, neoclassical economists strive to develop various tools that will aid them in analyzing the system. These tools are developed with from mathematical models and are then used to hypothetically deduce an explanation or solution to the defined problem. A typical example of this method of analysis is the marginal revenue that is usually used to calculate the extra income that will be gained from selling an additional unit of a particular commodity. Mathematically, it is described as the rate of change of total revenue per change in the number of units sold and can be expressed as From the relation above, TR is the total revenue, P is the price of the commodity and Q is the quantity demanded. When the price does not change with quantity, then meaning that the marginal revenue is equal to the price of the commodity (Evans & Phillips, 2006). To address the main purpose of this essay, which is to know whether neoclassical economics represents an evolution of economic theory from an early, flawed version (Classical Economics) to a more advanced, improved theory or rather represents the birth of a new discipline that decided to abandon many of the questions and issues that had troubled Classical Economics instead of trying to offer a better way to address them, it can be inferred from the above discussion of both economic theories that contrary to the popular views of people that neoclassical economic theory evolved from classical economic theory so as to amend its flaws, the opposite (not reverse) is the case, that is, the neoclassical economic theory actually evolved from the classical economic theory but it addressed a complete set of totally different issues. The reason for this assumption is evident. The classical economic theories as earlier discussed mainly addressed the issues concerning the labor theories of value, theories of distribution, and that of comparative advantage while the neoclassical economic theories essentially address the issue of marginal utility, rational preferences, and the predilection of individuals to act on the basis of full and relevant information. Placing these issues side-by-side, one would observe that they are quite different and do not seem to overlap. This means that as much as it is that the neoclassical economists evolved from the classical economists, their views are entirely different and do not seem to correlate. For instance, the theories of distribution which emphasize that national the national product is divided between the laborer, capital owner and the landlord, is not in any way applicable to any of the issues attended to by the neoclassical economists. Similarly, the theory of marginal utility as an issue addressed by the neoclassical economists is not applicable in either the labor theory of value, comparative advantage principle or the theory of distribution. What this spells out is that the neoclassical economic movement represents the birth of an entirely new discipline that has decided to abandon many of the questions and issues that had troubled classical economics instead of trying to offer a better way to address them. Instead of improving on the issue of labor theory of value, it chose to adopt a totally new issue which it termed theory of marginal utility thereby creating difficulties when it comes to finding a correlation between both economic movements. Also, when considering the analytical tools employed by both economic movements, it is apparent that there are conflicting issues as well which further buttress the point that is being made here. While the neoclassical economists are hypothetically or mathematically inclined, the classical economists are historically inclined. Generally speaking, most scholars who have studied both methods of analyzing the economy would stick with the classical because it is believed that economics as a social science is more accurately gauged by the historical approach than mere mathematical models which failed to address the issues surrounding the great depression in the 1920s when it occurred. Subjectively speaking therefore, the neoclassical economic movement does not improve on classical economics as claimed by many but instead, it addressed a brand new project. Finally, given the methods of economic analysis employed by both, it is evident that the neoclassical analytical method is not as effective at addressing its goals as much as the classical analytical method is at addressing its own goals which still points out the point that has been made by this essay. References Evans, B. , & Phillips, S. (2006). Comprehensive History of Economics (4th ed. ). Pretoria: Brayton Publishers.

A Comparison Of George Orwells And Dorians Reality

Comparison of Winston’s and Dorian’s Reality Everyday people wake up in their own homes and act themselves and do what they need to do to get ready for the day, and people put on their social masks as they enter into everyday society. In the novel 1984, written by George Orwell, the overall idea of the book revolves around the fact that everyone portrays a front and never actually displays who they really are for fear of death; moreover, in the novel Picture of Dorian Gray, shares similar characteristics on how people portray a face different from what they show in public. Continually, the idea of social masks and identity can be seen through the manipulation of previous events and how they shape the mindset of people with how they act;†¦show more content†¦The curves of your lips rewrite history.† (Wilde 54). The emphasis on how the person who rewrites history is the one who is described as elegant and said to me made of ivory and gold. This portrays an out-and-out in how the rich and powerful, or those who are made of ivory and gold are able to rewrite history. Through this ability to control the past, Big Brother is able to command how Winson and others act socially like the restriction on facial expression and putting laws in place to even control how people think. They are able to do this because of how they have painted the past and how it shows them as a powerful organization that cannot be challenged, and just as in The Picture of Dorian Gray they have no choice but to follow directions and put on their social masks. Continually, the adoption of constant social masks that are worn by those in the novel 1984 and the lack of identity that they all face can be accounted from the propaganda that is always present in daily life. Moreover, the propaganda that is being produced is just factually wrong from what we know in the real world. As Winston describes how the saying â€Å" War is Peace, Freedom is Slavery, Ignorance is Str ength.† (Orwell 34). This slogan was plastered everywhere and on everything you looked at as