My country (India) is a
mixed economy but is gradually shifting towards capitalism. Can someone please throw some light on the part that ethics play in a market driven economy and suggest some measures that a country like Russia or China should take if they decide to shift from being communist or socialist towards being
My country (India) is a
Ethics are rules that constrain human behavior because of some inherent or instrumental value that the rules serve. The main distinction of greater central control (rule by authorities) and greater external control (rule by people other than the parties to a transaction) will ever eliminate the ethics of transactions or the presence of unethical transactions.
Ethical problems are questions of how humans should behave and interact, so they are present whenever you put more than zero humans into a given situation. Government regulation, collective ownership, social codes, and other rules foisted on transactional parties are all going to have their own ethical implications and problems. The people writing and enforcing those rules will all have the opportunity to behave unethically in a myriad of ways.
The main value to switching away from a system that involves centralized or external control of people's decisions is that it tends to reduce the need to placate or bribe officials. If someone has no right to operate a business, then they must bribe any officer or agent who comes by with a veiled threat. But if a system clearly presumes the right to operate a business, then it's more difficult to look for bribes.
Then you have the body of ethical issues outside corruption, such as whether it's ethical to shutter a business for failure to file a given bureaucratic form, whether it's ethical to require one's competitors to approve your business locations, and whether it's ethical to set the terms of other people's decisions and choices.
One of the oldest and most established arguments for a market economy is the concept of the
Without going into too much detail The idea is that when people try to make themselves successful in a free market, they may also be benefiting society.
as it apples to your ethics example:
Suppose a company has poor ethics, and people find out that they're using poor ethics. Suppose they're knowingly producing a lower quality product, and are trying to advertize it as a higher quality product.
Word gets out that their product is low quality, and people don't want to do business with the company anymore, so therefore it's in their best interest to keep the customer happy.
In this case, the ethics are imposed by the customer.