ethic of capitalism

ethic of capitalism - The Ethic of Capitalism: Peace,...

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Journal of International Management Studies, Volume 3, Number 1, Feb. 2008 1 The Ethic of Capitalism: Peace, Prosperity, and the Good Life through Microfinancing Sean D. Jasso, Ph.D. © Journal of International Management Studies, Volume 3, Number 1, Feb. 2008, pp. 195-205 1 (ISSN: 1993-1034) ABSTRACT This paper argues that at the center of the peaceful, prosperous, and flourishing society is not only a democratic social contract between the state and its citizens, but also the service infrastructure of an institution that enables the access to capital for all of its people, including the poor. In 2006, economist and banker Muhammad Yunus, founder of Grameen Bank, won the Nobel Peace Prize for his ‘efforts to create economic and social development from below’. The guiding objective of this paper is to build upon the discussion that peace and prosperity are attributed to economic growth through capitalism fueled by entrepreneurship and funded with credit. The central questions that steer the paper toward this discussion objective include: How does capitalism help the poor? What is the value of the entrepreneur? What theoretical model best describes credit as the tool for economic growth from below? The ultimate aim is to attribute the success or failure of the capital society to ethics – that is, the tools we use to achieve the good for ourselves and for others. Hence, at the root of any prize for peace is not only the ethic of capitalism, but the ethic of economics. Keywords: microcredit; microfinance; capitalism; ethic of capitalism; ethics INTRODUCTION This paper’s central argument is that capitalism, that is the ownership of or access to the factors of production 2 , is the way out of poverty – no other solution has the sustainability to offer tools to recover or to rise from being poor. Stated differently, the creation of wealth is the only long-lasting practice of building economic stability in political economies that understand the phenomenon that markets produce the best solutions for society – jobs, products, services, investments. Certainly, the strength of a nation’s democratic political and economic institutions will yield different results. Results can be measured in various ways from unemployment rates, numbers of new small business licenses issued, to the general levels of happiness among citizens, to name a few. I do not suggest that simply exercising capitalism will offer quick economic relief or even long-term prosperity as capitalism requires a commitment to risk and investment. The poor have been part of the social structure since humans formed groups. As a social and policy concern, poverty, that is the severe consequence of being poor, has been a political agenda item for centuries with various responses from complete ignorance, to social welfare, to work houses, to debtors prisons, to national and world aid programs, to foreign direct investment – all of which have had diverse impacts. The literature often concludes that aid programs offer short-term relief rather than lasting relief up to and including poverty elimination
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This note was uploaded on 04/16/2011 for the course BUS 102 taught by Professor Jasso during the Fall '09 term at UC Riverside.

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ethic of capitalism - The Ethic of Capitalism: Peace,...

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