ssrn-id1685288

ssrn-id1685288 - GLOBAL DEVELOPMENT AND ENVIRONMENT...

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Electronic copy available at: http://ssrn.com/abstract=1685288 G LOBAL D EVELOPMENT AND E NVIRONMENT I NSTITUTE W ORKING P APER N O . 10-06 Does Profit-Seeking Rule Out Love? Evidence (or Not) from Economics and Law Julie A. Nelson September 2010 Prepared for the symposium "For Love or Money?" and submitted to the Washington University Journal of Law and Policy . Tufts University Medford MA 02155, USA http://ase.tufts.edu/gdae © Copyright 2010 Global Development and Environment Institute, Tufts University
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Electronic copy available at: http://ssrn.com/abstract=1685288 GDAE Working Paper No. 10-06: Does Profit-Seeking Rule Out Love? Abstract Many believe that firms are driven to maximize profits, and therefore are not allowed to take actions that would benefit their workers, communities, or the environment if these actions would reduce profits even slightly. This essay shows that this belief is supported neither by sound economic evidence and arguments, nor by United States statutory and case law. The roots of this belief are, instead, to be found in a centuries-old desire of economists to make our discipline look like Newtonian physics. Among scholars of law, both misinformation and the use of University of Chicago-style economics have contributed to the belief's popularity. Among scholars and the public alike, the dualistic "love or money" view is appealing because of its simplicity and congruence with cultural gender norms. Reexamining the evidence, rather than adhering to common ideologies, this essay offers an unconventional analysis of corporate behavior and commodification. Keywords: profit maximization, shareholder value, corporations, law, economics, gender, commodification, corporate social responsibility. 1
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GDAE Working Paper No. 10-06: Does Profit-Seeking Rule Out Love? maximization serves to disto Does Profit-Seeking Rule Out Love? Evidence (or Not) from Economics and Law Julie A. Nelson I. Introduction Does profit-seeking rule out direct concern for human well-being, environmental sustainability, and the public interest? Many would answer, "Of course." In contemporary Western culture, we tend to associate profits, money, and markets with coldness, distance, and self-interest. Care and concern, on the other hand, are associated with love, and thought to reside elsewhere—in families and interpersonal relations, or in benign images of community and public service. This dualistic division between spheres of "money" and "love" permeates many discussions in the social sciences, humanities, and law, and has recently come to the fore in two major ongoing controversies. One of these is concerned with the growing marketization of activities such as childcare and reproductive services. When money enters areas traditionally associated with love, many fear that the activities become "commodified" or "commoditized" and drained of their authentic human meaning. 1
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ssrn-id1685288 - GLOBAL DEVELOPMENT AND ENVIRONMENT...

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