Week 3_The Legal Foundation and Institutions for Market-Based Economies

Week 3_The Legal Foundation and Institutions for Market-Based Economies

Info iconThis preview shows pages 1–12. Sign up to view the full content.

View Full Document Right Arrow Icon
The Legal Foundation and Institutions for Market-Based Economies September 16, 2009
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Content of Lecture Rule of Law Corruption Reform
Background image of page 2
“The Invisible Hand of a Free Market is Nothing Without the Long Arm of the Law”
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Why Regulate Markets? 1. Consumer protection 2. Market integrity 3. Systemic stability
Background image of page 4
Determinants of Competitive Advantage Firm Strategy, Structure, Rivalry Factor Conditions Demand Conditions Related and Supporting Industries
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Firm’s orientation Motivated by profits, market share 1) Production approach: costs, production. Mass marketing; e.g. , Ford 2) Product quality (Differentiation): Superior product; e.g. Mercedes, Bose, and Rolex 3) Sales Approach: Aggressive sales tactics as practiced by credit cards and insurance agents 4) Marketing Approach: “Consumer is King.” The key to success hinges upon asking what the consumer wants 5) Social Philosophy: fulfill society/customer needs first before the organizational need for success e.g. hybrid cars, Ben & Jerry’s Ice -cream, fair trade products
Background image of page 6
Rule of Law Markets depend on the legal systems in four general ways: 1. Property rights 2. Contracts 3. Companies 4. Finance Rule of law = all people are governed by the same rules, so the rich and powerful may not exempt themselves from the rules other are supposed to follow
Background image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Rule of Law (2008) Source: www.govindicators.org, Governance Matters 2009
Background image of page 8
Source: http://gcr.weforum.org/gcr/
Background image of page 9

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Corruption “The misuse of entrusted power for private gain” (Transparency International definition) Illegitimate payments and favors (outside the rule of law) Includes bribery, rent-seeking, extortion, and embezzlement
Background image of page 10
Source: Transparency International, Global Corruption Report 2009: Corruption and the Private Sector
Background image of page 11

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 12
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 02/21/2010 for the course AEM 4420 at Cornell University (Engineering School).

Page1 / 30

Week 3_The Legal Foundation and Institutions for Market-Based Economies

This preview shows document pages 1 - 12. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online