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Chapter 3 Summary - P art 2 Chapter Objectives Summarizing...

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Part 2: Chapter Objectives, Summarizing Outlines, And Case Notes Chapter 3: Business Power LEARNING OBJECTIVES To define the concept of power and describe how corporations exercise power. How business power is exercised at both surface and deep levels in seven spheres of influence. Two theories of business power: the dominance theory and the pluralist theory. The main boundaries on managerial power. To illustrate specific ways in which corporate power has changed society. How John D. Rockefeller’s Standard Oil Company changed an industry and a nation. SUMMARIZING OUTLINE This chapter explains the tremendous power of corporations to change society through their actions. It illustrates this power with stories about the American Tobacco Company, the railroads, J. P. Morgan, and the Standard Oil Company. Power is defined, then its exercise is described on surface and deep levels in areas corresponding to the key environments set forth in Chapter 2. Finally, two theories of business power are set forth the dominance theory of overbearing power and the pluralistic theory of counterbalanced power. The introductory story is about the American Tobacco Company . The company was founded by entrepreneur James B. Duke after the Civil War. Duke capitalized on the new technology of the Bonsack machine to increase output of cigarettes and used clever marketing to sell them worldwide.
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