Chapter 1 - The Study of BGS Flashcards
Sherman antitrust act of 1890
Created in response to Rockefellers monopoly in the oil business
Define business
Profit making activity that provides products and services to satisfy human needs.
Define Government
Structures and processes in society that authoritatively make and apply policies and rules.
Define Society
A network of human relations composed of ideas, institutions, and material things.
Define Value
And enduring believe about which fundamental life choices are correct.
Define ideology
A bundle of values that creates a particular world view.
Define institution
A formal pattern of relations that links people to accomplish a goal.
How institutions support markets (image)
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Why is the BGS field important to managers?
To succeed in meeting it’s objectives a business must be responsive to both its economic and noneconomic environment.
Social contract
An underlying agreement between business and society on basic duties and responsibilities business must carry out to retain public support. It may be reflected in laws and regulations.
What are the four models of the BGS relationship?
- The market capitalism model.
- The dominance model.
- The countervailing forces model.
- The stakeholder model.
Market economy
The economy that emerges when people move beyond subsistence production to production for trade, and markets take on a more central role.
Capitalism
And economic ideology with a bundle of values including private ownership of means of production, the profit motive, free competition, and limited government restraint in markets.
Market capitalism model
Business operates in a market environment, responding primarily to powerful economic forces. There it is substantially sheltered from direct impact by social and political forces. The market acts as a buffer between business and non-market forces.
Laissez-faire
An economic philosophy that rejects government intervention in markets.
The dominance model
The dominant model represents primarily the perspective of business critics. In it, business and government dominate the great mass of people. This is represented in a pyramid shaped hierarchy.
Populism
A political pattern, recurrent in world history, in which common people who feel pressed for disadvantaged seek to take power from a ruling elite seen as thwarting fulfillment of the collective welfare.
Marxism
And ideology holding that workers should revolt against property owning capitalists who exploit them, replacing economic and political domination with more equal and democratic socialist institutions.
The countervailing forces model
The countervailing forces model depicts the BGS relationship as a flow of interactions among major elements of society. It suggests exchanges of power among them, attributing constant dominance to none.
The stakeholder model
The corporation is at the center of an array of relationships with persons, groups, and entities called stakeholders.
Primary stakeholders
Entities in a relationship with the corporation in which they, the corporation, or both or affected immediately, continuously, and powerfully. Examples include stockholders customers employees communities and governments.
Secondary stakeholders
Entities in a relationship with the corporation in which the effects on them, the corporation, or both are less significant and pressing. Examples include earths biosphere religious groups unions media competitors future generations.
