21. Why Rawls thinks we should minimize the social consequences of natural differences- Rawls believes that justice tries to minimize the social consequences of purely arbitrary, natural differences. People do not deserve the attributes they were born with or that reflect their environment and upbringing. Chapter 4 Key Terms and Concepts 1. Alienation- separation of individuals from the objects they create, which in turn results in one’s separation from other people, from oneself, and ultimately from one’s human nature 2. Capital- capital is money that is invested for the purpose of making more money. 3. Capitalism- economic system that operates on the basis of profit and market exchange and in which the major means of production and distribution are in private hands. 4. Comparative advantage- the goods that it can produce at a lower opportunity cost than other countries can (it can produce more cheaply relative to other goods than is the case in other countries). 5. Competition- regulator that keeps a community activated only by self-interest from degenerating into a mob of ruthless profiteers 6. Corporate welfare- programs which often shelter businesses from competition 7. Exploitation- taken advantage of workers 8. Financial capitalism- when industries strengthen their financing and shore up their assets 9. Globalized capitalism- increasing worldwide scale of capitalism 10. Hollow corporations- companies that in years past were identified with making goods of all sorts now are likely to produce only the package and the label 11. Industrial capitalism- industrialists replaced merchants as the dominant power in a capitalist economy. Large scale industry
12. Invisible hand- Adam Smith: when people are free to pursue their own economic interests, they will, without intending it, produce the greatest good for all 13. Laissez faire- to let people do as they choose 14. Mercantile capitalism- capitalism that is based on mutual dependence between state and commercial interest 15. Natural right to property- one basic defense of capitalism rests on a supposed natural moral right to property 16. Oligopolies- concentration of property and resources, and thus economic power, in the hands of a few 17. Outsource- sending oversees 18. Profit motive- implies critical assumption about human nature—that human beings are economic creatures who recognize and are motivated by their own monetary interests 19. Short-term focus- companies are preoccupied with short-term performance at the expense of long-term strategies 20. Socialism- the polar opposite of capitalism, an economic system characterized by public ownership of property and a planned economy 21. State welfare capitalism- government plays an active role in the economy, attempting to smooth out the boom- and-bust pattern of the business cycle through its fiscal and monetary policies 22. Work ethic- value work for its own sake, seeing it as something necessary for every person. Emphasizes the belief that hard work pays off in the end and is thus part and parcel of the American Dream 23.
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