The Free Market
Discuss why the phrase, "The Free Market," may be an oxymoron. In particular, describe the types of laws, rules and regulations that must be in place and enforced in order for a modern business (assume a manufacturer of consumer products) to thrive in a global environment."The Free Market" is frequently characterized as a market or free enterprise economy operating in economic activities with minimal government intervention. The power of corporations to manipulate and control markets is now enormous and, because of the handcuffs placed on governments by trade deals, it is growing exponentially. In the today's western political economy, however, the role of regulation has become a vital intervention to co-exist with the free market principle.Society aims to achieve economic and social performance goals. Economic performance goals include such things as low unemployment, efficient productivity and optimal relationships among prices, costs and profits. Social performance goals are based on the common values of well being such as ethics and morals. Our economy has become more integrated and international over time, and to achieve such economic and social performance goals, regulations need to be drafted and enforced ap
We become the people of the "Pepsi generation" detached from any place or meaning other than those a corporation finds is profitable to confer on us. By the late 1990s, twelve industrial sectors-including consumer durables, automotive, aerospace, electronic components, and steel-were monopolistic. " Indeed, with no government intervention, there would be significant performance shortcomings: consumers would be served unwholesome food, breathe polluted air, and pay unreasonably high prices. The consumer industry also affects people's lives in terms of culture. Consumer products manufacturers such as Unilever and Nestle are multinational in their reach, and they often have considerably more power than national governments. Oil, personal computers, and the media are not far from the monopolistic definition. The consequence is that the interests of such corporations diverge ever further from human interests. Multinational corporations are able to manipulate the cultural values and universal symbols of the societies of the world through their advertisement, product placement and technological utilization. This does not mean to stifle the free market, but to have a more efficient market mechanism to better achieve the economic and social performance goals. " One might say, therefore, that regulation is actually the "natural" state of affairs, and that there is a disproving presumption against this concept of a "Free Market. As a result, this makes markets inherently biased in favor of wealthy people. Big companies like to help the people so that they can make political and economic decisions to their advantage. Such controls include use of renewable resources at slower rates than the rates at which the ecosystem is able to regenerate them; consumption rates of non-renewable resources that do not exceed the rates at which substitutes are developed; and pollution emission rates that do not exceed the rates of the ecosystem's natural assimilative capacity. Consumer companies must also be strictly regulated in terms of the environment. It would obviously be better to serve the social performance goals with regulation of heritage and tradition, where the value and identity of each individual, community and country would enhance rather than degrade.
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