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BUS 206 AC Managerial Capitalism vs Shareholder Theory Case Questions



This is the first case :

B1: The question of the social responsibility of business concerns what kind of reasons managers of
corporations should consider when making business decisions for the corporation.

B1a. Explain the meaning of the phrase “managerial capitalism.”

B1b. Identify the roles and responsibilities of the “corporate players.”

B1c. What is the purpose of separating ownership from management in traditional

This is the second case

A1: Stockholder Theory

A1a. According to Stockholder Theory, a manager of a traditional corporation has an ethical
obligation to privilege the interests of the stockholders over the interests of others. Why?

A1b. How does Friedman define the doctrine of “social responsibilities of business” and why
is it unethical for businesses to engage in socially responsible acts?

A1c. Critics of the Stockholder Theory complain that it is “rife with moral hazard.” How so?