BUSINESS ETHIC AND VALUES : EVOLUTION OF BUSINESS AND ECONOMY IN THE MARKET SOCIETY

OVERVIEW
Progress of market
Ideology and Economic System
Characteristics of Market Economy
Legitimacy of Business to Society

PROGRESS OF MARKETS
The Feudal Era
-The feudal era is associated with a historical period known as the Dark Ages
-Socio-economic and political systems were based on reciprocal relationships between lords and serfs
-Economic institutions were static - farming and agriculture were the main sources
-Military protection and the general welfare of the community is taken care of by the Master in return for food supply and other requirements given by the serfs and peasants.

The Basic Features of Feudal Markets:
-Production in the feudal market system was only sufficient to fulfill the necessity of human lives like food, shelter, and clothing,
-The barter system (trading by exchanging one's products with other people's) was widely practiced,
-Natural resources like land, sea, and river were the ultimate source of income as activities like fishing, farming, harvesting, and hunting, are of high prominence, and
-Participation of individuals in the economy was to sustain the traditional lifestyles and cultures besides safekeeping the nature.

Nature of the Feudal System:
-The feudal market system was in existence as early as the early civilizations until the end of the Dark Ages in Europe.
-The markets were marginal institutions that functioned as part of the fabric of socio-political systems.
-Market values were not among the highly esteemed values of society and even profits were looked upon negatively.
-Merchants were viewed as the lower social strata.
-Era of enlightenment and reformation -Improvement of the merchant class and industrial advancements:
==>economic values grow stronger
==>market forces reach social activities
==>profit as human motivation
==>capital accumulation as a reason for further production

IDEOLOGY AND ECONOMIC SYSTEM
-Three types of economic systems; the capitalist system, command system, and mixed system
-The capitalist system is characterized by private ownership of resources and the use of markets and market variables to coordinate economic activities
Features of capitalism:
==>compete to achieve economic growth and progress
==>taste and talents enhance self-interest maximization
==>controlled by market and price mechanisms
==>none or less government intervention

CHARACTERISTICS OF THE MARKET ECONOMY
=entrepreneurship that emphasizes on profits,
=innovations and risk-taking endeavors,
=self-interest maximization,
=prudence in the business system,
=competition and freedom of entry into the market,
=inherent impersonal relationships,
=divisions of labor,
=unequal distribution of wealth and income,
=class relations or divisions, and
=overproduction and other crises of the capitalist system.

LEGITIMACY OF BUSINESS TO SOCIETY
-The relationship between businesses and the society is one of mutual interdependence
-The role of businesses in providing goods and services to the society
-Meeting the expectations and demands of stakeholders