Essay on ib business and management

Submitted By hannemokster
Words: 640
Pages: 3

To what extent does the objective of profit make a positive contribution to society?

From a producer’s perspective the objective of profit allows companies to reinvest which can result in a higher quality service. Profit motivated producers also tend to do more for less, because efficiency is often rewarded, unlike the public sector that has a regular salary. In addition to have a more efficient use of human resources, does profit motivated companies have an interest in making quick profit as well as a positive development in the long-term, it is therefor argued that they have a more sustainable development. On the other hand does the public counteract duplication of resources, and there will be no waste of limited resources. The most significant fact is that the objective of profit will increase efficiency. Because the private producers reward the workers efficiency, which means they get more done for less. Therefor is it cheaper to produce in the private sector.

Theoretically would the motive of profit reduce price. Due to increased efficiency, which means fewer employees, which then again should result in lower prices. From a consumers perspective this sounds ideal, however in reality we often end up paying more as the companies will always strive to make the most profit. Publicly provided companies, on the other hand are subsidized by the government and motivated by making services more accessible and affordable for the consumers. They will not close down unprofitable production, and is motivated by the consumers needs.
From a consumers perspective the most significant fact is that publicly provided companies provide a more affordable service. Because they are subsidized by the government whom has a reasonability to provide good essential service. Therefor, from a consumer’s point of view, the objective of profit is not a positive contribution.

The objective of profit from the government’s perspective could increase the entire standard of life, as govt. will be receiving big windfall from sale. They can choose either to cut taxes, or save up taxes on long-term and use the money to invest in the welfare of the citizens, like health and education. It is argued that private healthcare can be more efficient and operators more innovative and productive, due to the profit motive. But there are ethical issues related to privatization, as some people may not afford the treatment they need, and in addition to this will class division increase. A public govt. is motivated by the welfare of all