Abstract
This article pursues the question whether and inasmuch theories of corporate responsibility are dependent on conceptions of managerial freedom. I argue that neglect of the idea of freedom in economic theory has led to an inadequate conceptualization of the ethical responsibilities of corporations within management theory. In a critical review of the history of economic ideas, I investigate why and how the idea of freedom was gradually removed from the canon of economics. This reconstruction aims at a deconstruction of certain axioms of neoclassical economics that hamper contemporary efforts in integrating ethics firmly into management education. I intend to show by these deconstructive endeavors that a constructive use of the idea of responsible freedom could correct and complement the current quantitative focus in business theory through qualitative orientations. I argue that with the help of qualitative success criteria, the strategic integration of the tenets of both business ethics and Corporate Social Responsibility into business practice can be advanced by further research.
Similar content being viewed by others
References
Arena Christina, 2007. The High-Purpose Company. Smithsonian Books/Collins, New York, 2007.
Argyris, Chris. “Some limits of rational man organizational theory.” Public Administration Review 33 (May/June), 1973: 253-267.
Austin, James. Stevenson, Howard. Wei-Skillern, Jane. Entrepreneurship Theory and Practice.
Backhaus, J. and R. Hansen: 2000, ‘Methodenstreit in der Nationalökonomie‘, Journal for General Philosophy of Science 31(2), 307–336.
BCG (The Boston Consulting Group): 2009, The Business of Sustainability. Imperatives, Advantages, and Actions. Published Online in Cooperation with the MIT Sloan Management Review, at http://sloanreview.mit.edu/special-report/the-business-of-sustainability/.
Bentham, J.: 1789/1996, An Introduction to the Principles of Morals and Legislation (J. H. Burns and H. L. A. Hart, Eds.) (Oxford University Press, Oxford).
Bentham, J.: 1954, Economic Writings, Vol. 3 (George Allen and Unwin, London).
Bentham, J.: 1970, Of Laws in General (H. L. A. Hart, Ed.) (Clarendon Press, Oxford).
Bergmann, B. (1989). ‘Why do most economists know so little about the economy? in S. Bowles, R. Edwards and W. Shepherd (eds.), Unconventional Wisdom conventional Wisdom: Essays in Honor of John Kenneth Galbraith. New York: Houghton Mifflin Harcourt Company, pp. 29–37.
Boettke, P. J.: 1997, ‘Where did Economics Go Wrong? Modern Economics as a Flight from Reality’, Critical Review 11(1 Winter), 11–64.
Bostaph, Samuel. The Methodological Debate Between Carl Menger and the German Historicists, Atlantic Ecoomic Journal, Volume 6/Number 3, Dezember 1978, 3-16.
Boulding, Kenneth. “Economics as a Moral Science.” American Economic Review 59 (1), 1969: 1-12.
Brodbeck, K.-H.: 2000, Die fragwürdigen Grundlagen der Ökonomie, Eine philosophische Kritik der modernen Wirtschaftswissenschaften, Darmstadt 2000 (reprint 2007).
Cartwright, N.: 2006, ‘From Causation to Explanation and Back’, in B. Leiter (ed.), The Future for Philosophy (Clarendon Press, Oxford).
Chamberlain, Edward. “An experimental imperfect market.” Journal of Political Economy 56, 1948: 95-108.
Chytil, V.: 1941, Vom Begriff des Ganzen. Eine wirtschaftsphilosophische Betrachtung. Prag.
Clark, J. B.: 1899, The Distribution of Wealth (Macmillan, New York).
Cockfield, G., Firth, A., and Laurent, J. (2007). New perspectives on Adam Smith’s The theory of moral sentiments, Cheltenham, UK; Northampton, MA: Edward Elgar.
Crisp, Roger. “Persuasive Advertising, Autonomy, and the Creation of Desire.” Journal of Business Ethics 6, 1987: 413-418.
Dasgupta, Partha. “What do economists analyze and why: value or facts?” Economics and Philosophy, 21, 2005: 221-278.
Dierksmeier, C.: 2003, ,Über den gegenwärtigen Stand der Wirtschaftsphilosophie‘, Archiv fÜr Rechts- und Sozialphilosophie 3, 551–561.
Dierksmeier, C.: 2007, ,Qualitative oder quantitative Freiheit?‘, Rechtsphilosophische Hefte XII, 107–119.
Dierksmeier, C.: 2009, ‘A Requisite Journey: From Business Ethics to Economic Philosophy’, in Humanism in Business, edited by The Humanistic Management Network (Cambridge University Press, Cambridge), pp. 68–83.
Dierksmeier, Claus/Pirson, Michael, Oikonomia versus Chrematistike. Aristotle on Wealth and Well-Being. Journal of Business Ethics, Volume 88, Issue 3(2009), pp. 417.
diZerega, G.: 1997, ‘Market Non-Neutrality: Systemic Bias in Spontaneous Orders’, Critical Review 11(1 Winter), 121–144.
Douglas, Heather E., “Science, Policy, and the Value-Free Ideal”,U. of Pittsburgh Press, 2009.
Drascek, M./Maticic, S., What Managers Could See in the Philosophical Block of Free Will‘?, Journal of Business Ethics, Volume 81, Number 1, 2008, 1-14.
Elkington, John. Hartigan, Pamel. The Power of Unreasonable People. How Social Entrepreneurs create Markets that change the World, Harvard Business School Publishing, Boston 2008.
Fehr, E., U. Fischbacher and M. Kosfeld: 2005, Neuroeconomic Foundations of Trust and Social Preferences. Discussion Paper No. 1641. IZA, Bonn, Germany.
Friedman, Milton. Essays in Positive Economics, Chicago: University of Chicago Press, 1953.
Friedman, Milton. Capitalism and Freedom. Chicago: University Of Chicago Press 1962.
Friedman, M.: 1970, ‘The Social Responsibility of Business is to Increase Its Profits’, New York Times Magazine, New York, pp. 32–33.
Galbraith, J. K.: 1958, The Affluent Society (Houghton Mifflin Company, New York).
Galbraith, J. K.: 1967/1986, The New Industrial State (Houghton Mifflin, Boston).
Galbraith, John Kenneth. The Economics of Innocent Fraud: Truth for our Time. New York: Houghton Mifflin Books, 2004.
Gioia, D. A.: 2002, ‘Business education’s role in the crisis of corporate confidence’, Academy of Management Executive 16(3), 142-144.
Gioia, D. A.: 2003, ‘Teaching Teachers to Teach Corporate Governance Differently’, Journal of Management & Governance 7(3), 255-262.
Goshal, S.: 2003, ‘Business Schools Share the Blame for Enron’, Financial Times, 17 July 2003.
Goshal, S.: 2005, ‘Bad Management Theories Are Destroying Good Management Practices’, Academy of Management Learning and Education 4(1), 75-91.
Haney, L. H.: 1949, History of Economic Thought, 4th Edition (Macmillan, New York).
Harrison, E. F. (1995). The managerial decision-making process, Boston: Houghton Mifflin.
Hayek, Friedrich August von. Constitution of Liberty, University of Chicago Press, 1970.
Hayek, F. A. v.: 1952, The Counter-Revolution of Science (Free Press, Glencoe).
Heilbroner, R. L. (1953). The worldly philosophers: the lives, times, and ideas of the great economic thinkers, New York,: Simon and Schuster.
Heilbroner, Robert (1979) “Modern Economics and a Chapter in the History of Economic Thought”, History of Political Economy. 11(2):192-198.
Jensen, M.: 1993, ‘The Modern Industrial Revolution, Exit, and the Failure of Internal Control Systems’, The Journal of Finance, Vol. 48, pp. 831–880 (Papers and Proceedings of the Fifty-Third Annual Meeting of the American Finance Association, Anaheim, CA, 5–7 January, 1993).
Jensen, M. and K. J. Murphy: 1990a, ‘Performance Pay and Top-Management Incentives’, Journal of Political Economy 98, 225–264.
Jensen, M. and K. J. Murphy: 1990b: ‘CEO Incentives – It’s Not How Much You Pay, But How’, Harvard Business Review 68, 138–153.
Jevons, W. S.: 1871/1970, The Theory of Political Economy (Penguin Books, Marmondsworth).
Jevons, W. S. (1874). The principles of science : a treatise on logic and scientific method, London: Macmillan and Co.
Keynes, J. M.: 1923, ‘A Tract on Monetary Reform’, in Collected Writings, Vol. IV (Macmillan, New York).
Keynes, J. M.: 1936/1997, The General Theory of Employment, Interest, and Money (Prometheus Books, New York).
Khurana, R.: 2007, From Higher Aims to Hired Hands. The Social Transformation of American Business Schools and the Unfulfilled Promise of Management as a Profession (Princeton University Press, Princeton).
Kimakowitz, E. v. and M. Pirson, C. Dierksmeier, H. Spitzeck and A. Wolfgang (eds.): 2010, Humanistic Management in Practice (Palgrave Macmillan Publishers, Basingstoke).
Kirchgässner, G.: 1991, Homo oeconomicus. Das ökonomische Modell individuellen Verhaltens und seine Anwendung auf Wirtschafts- und Sozialwissenschaften (J.C.B. Mohr, Tübingen).
Knight, F. H.: 1921/1971, Risk, Uncertainty and Profit (Harper, New York) (Reprinted Chicago/London, 3).
Lagrange, J. L.: 1788, Mécanique analytique (Desaint, Paris).
Lantos, G. P. and S. Cooke: 2003, “Corporate Socialism Unethically Masquerades as ‘CSR’: The Difference Between Being Ethical, Altruistic, and Strategic in Business,” Strategic. Direction 19(6), 31–35.
Lippke, Richard. “Advertising and the Social Conditions of Autonomy.” Business & Professional Ethics Journal 8 (4), 1989: 35-58.
Lowe, A. (1977). On economic knowledge : toward a science of political economics, White Plains, N.Y.: M. E. Sharpe.
Lucas, R. E. On the Mechanics of Economic Development, Journal of Monetary Economics 22(1998), 3-42.
Marcuse, H.: 1964, One-Dimensional Man. Studies in the Ideology of Advanced Industrial Society (Beacon Press, Boston).
Marglin, S.: 1999, ‘John Kenneth Galbraith and the Myths of Economics’, in H. Sasson (ed.), Between Friends: Perspectives on John Kenneth Galbraith (Houghton Mifflin, Boston).
Margolis, J. D. and Walsh, J. P.: 2003, “Misery Loves Companies: Rethinking Social Initiatives by Business”, Administrative Science Quarterly 48 (2), 268-305.
Maritain, J.: 1947, The Person and the Common Good (Charles Scribner’s Sons, New York).
Marshall, A.: 1890, Principles of Economics (Macmillan and Co., London) (Quotations follow the 8th edition from 1920).
Marshall, A.: 1897, ‘The Old Generation of Economists and the New’, The Quarterly Journal of Economics 11, 115–135.
Matten, D. and Moon, J.: 2004, ‘Corporate Social Responsibility Education in Europe’, Journal of Business Ethics 54(4), 323-337.
May, K.: 1947, Technical Change and Aggregation, Econometrica 15, 51–63.
McCloskey, Donald. Knowledge and Persuasion in Economics. New York: Cambridge University Press, 1994.
Menger, C.: 1871, Grundsätze der Volkswirtschaftslehre. Erster Allgemeiner Theil (Wilhelm Braumüller, Wien).
Menger, C.: 1883, Untersuchungen Über die Methode der Sozialwissenschaften und der Politischen Ökonomie insbesondere (Duncker and Humblot, Leipzig).
Mirowski, P. (1988). Against mechanism : protecting economics from science, Totowa, N.J.: Rowman & Littlefield.
Mirowski, P. (2002). Machine dreams : economics becomes a cyborg science, Cambridge; New York: Cambridge University Press.
Mises, L. v.: 1931a, Die Ursachen der Wirtschaftskrise (Mohr, Tübingen).
Mises, L. v.: 1931b, The Economic Causes of the Crisis (reprinted Auburn 2006).
Mises, L. v.: 1940, Nationalökonomie (Wirtschaft und Finanzen, Genf).
Net Impact: 2007a, New Leaders, New Perspectives: A Net Impact Survey on MBA Student Opinions on the Relationship Between Business and Social/Environmental Issues (San Francisco).
Net Impact: 2007b, New Leaders, New Perspectives II: A Net Impact Survey on Undergrad Student Opinions on the Relationship Between Business and Social/Environmental Issues (San Francisco).
Net Impact: 2008, Business as Unusual (San Francisco).
Neurath, O.: 1931, ‘Soziologie im Physikalismus‘, Erkenntnis II, 393–431.
Nguyen, H.: 2000, Do Humanistic Values Matter? Academy of Management Best Paper Proceedings. ODC, New Orleans, pp. A1–A6.
Niehans, J.: 1980, A History of Economic Theory. Classic Contributions 1720–1980 (Johns Hopkins University Press, Baltimore).
Nozick, R.: 1974, Anarchy, State, and Utopia (Basic Books, New York).
Pfeffer, J., 2005, ‘Why Do Bad Management Theories Persist? A Comment on Goshal’, Academy of Management Learning & Education 4(1), 96-100.
Pigou, A. C.: 1962, The Economics of Welfare (Macmillan, London).
Priogogine, I.: http://nobelprize.org/nobel_prizes/chemistry/laureates/1977/prigogine-lecture.pdf.
Robbins, L.: 1932, An Essay on the Nature and Significance of Economic Science (New York University Press, New York).
Robinson, Joan. Economic Philosophy. Harmondsworth, Middlesex, UK, 1962.
Rudner, Richard, “The scientist qua scientist makes value judgments”, Philosophy of Science (1953) 20: 1-6.
Sahlins, Marshall. Stone Age Economics. New York: Aldine Transaction, 1972.
Samuelson, Paul. (1938). A Note on the Pure Theory of Consumers’ Behaviour. Economica 5:61-71.
Samuelson, P.: 1947/1983, Foundations of Economic Analysis, enlarged ed. (Harvard University Press, Boston).
Schmidtz, David. Diminishing Marginal Utility and Egalitarian Redistribution, The Journal of Value Inquiry 34: 263–272, 2000.
Schmoller, G. v.: 1883, ‘Zur Methodologie der Staats- und Sozialwissenschaften‘, Schmollers Jahrbuch für Gesetzgebung, Verwaltung und Volkswirtschaft 7, 976–977.
Schmoller, G. v.: 1893/1949, Die Volkswirtschaft, die Volkswirtschaftslehre und ihre Methode (reprinted Frankfurt).
Schumpeter, J. A. (1954). History of economic analysis, New York,: Oxford University Press.
Sen, A.: 1998, Development as Freedom (Oxford University Press, Oxford).
Sen, A.: 1999, ‘Galbraith and the Art of Description’ in H. Sasson (ed.), Between Friends: Perspectives on John Kenneth Galbraith (Houghton Mifflin, Boston), pp. 139–146.
Sen, A.: 2002, Rationality and Freedom (Harvard University Press, Cambridge).
Shackle, George and Sherman, Lennox. Epistemics and Economics. A Critique of Economic Doctrines. Cambridge: Cambridge University Press, 1972.
Smith, A.: 1759. The Theory of Moral Sentiments (A. Millar, London).
Smith, A.: 1776, The Wealth of Nations (Methuen and Co., Ltd., London).
Spiegel, Henry William, “The growth of Economic Thought”, Duke University Press, 1971.
Stigler, George and Becker, Gary. “De Gustibus Non Est Disputandum.” American Economic Review 67 (2), 1977: 76-90.
Sundaram, K. Anat and Inkpen, Ndrew. “The Corporate Objective Revisited.” Organization Science 15(3), 2004: 350-363.
Ulrich, Peter. Integrative Economic Ethics. Foundations of a Civilized Market Economy. Cambridge: Cambridge University Press, 2008.
Veblen, T.: 1898, ‘Why is Economics not an Evolutionary Science?’, Quarterly Journal of Economics 12, 373–397.
Viner, J.: 1991, In D. A. Irvin (ed.), Essays on the Intellectual History of Economics (Princeton University Press, Princeton,
Waligorski, Conrad. The Political Theory of Conservative Economists. Lawrence: University of Kansas Press, 1990.
Walras, Léon. économique et méchanique, 1909, Bulletin de la Societe Vaudoise de Sciences Naturelles, Vol. 45, 313-324.
Warke, Tom, Mathematical fitness in the evolution of the utility concept from Bentham to Jevons to Marshall, Journal of the History of Economic Thought, Vol. 22, Number 1, 2000, 5-27.
Weber, M.: 1904, ‘Die “Objektivität” sozialwissenschaftlicher und sozialpolitischer Erkenntnis‘ Archiv für Sozialwissenschaft und Sozialpolitik 19 Band, 503–574.
Weber, M.: 1918, ‘Der Sinn der “Wertfreiheit” der soziologischen und ökonomischen Wissenschaften‘, Logos 7, 451–502. (Reprinted from Gesammelte Aufsätze zur Wissenschaftslehre, by J. Winckelmann, 1988, Tübingen: Mohr.)
Wieser, F. v.: 1884, Über den Ursprung und die Hauptgesetze des wirthschaftlichen Werthes (Hölder, Vienna).
Young, J. T. (2009). Elgar companion to Adam Smith, Cheltenham, Glos, UK; Northampton, MA: Edward Elgar.
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Dierksmeier, C. The Freedom–Responsibility Nexus in Management Philosophy and Business Ethics. J Bus Ethics 101, 263–283 (2011). https://doi.org/10.1007/s10551-010-0721-9
Published:
Issue Date:
DOI: https://doi.org/10.1007/s10551-010-0721-9