Introduction
In this essay, I argue that Amartya Sen’s consideration of the importance of trust in business politics is not entirely rational. I will initially explain Sen’s position in the paper by providing a general research summary. I will then focus on the specific examples Sen notes nonprofit values as firm success, recognition of success as a public good, and ethics as a comforting tool. Finally, I will make my own arguments that Sen’s proposed position on business ethics is not strong enough to justify the importance of nonprofit values.
Literature Review/Exegesis
Amartya Sen’s study analyzes three key economic indicators: exchange, production, and distribution. Sen examines these, drawing on Adam Smith’s stance on the butcher-butcher-bun. The central leitmotif of the study is the idea that the products produced by the firm as a whole constitute a public good (p. 50). Sen draws attention to the fact that the motivational background of the nonprofit base is the most important for the company’s appearance. In addition, he explains that this is due to the imperfection of market processes, which cannot be fully automated (p. 48). Sen focuses on “the productive merits of selfless work and devotion to enterprise have been given much credit for economic achievements”(p. 50). Based on this, he views enterprise success as a public good, indicating that it is only achievable with non-commercial values. The formation of these values takes place based on building trusting relationships, in which ethics is an instrument of consolation when one loses, that is, exchange.
Three key arguments used by Amartya Sen should now be highlighted. First, it is nonprofit values as a predictor of firm success. For this, Sen uses the example of Japan, agreeing that “[it] is ‘the only communist nation that works’” (p. 50). He is convinced that self-interest is not a positive factor in success since not all states view labor similarly (p. 47). Based on this, Sen claims that behavioral norms and ethics are central to any enterprise as it seeks to conform to market conditions (p. 48). As a consequence, firms thrive because they perform the function of helping rather than simply selling.
The following argument views Sen’s success as a public good derived from compliance with ethical norms of trust. Problems of mutual trust prevent the goods produced from being uncompetitive, so adequate motivation becomes a factor in developing that trust (p. 48). To this end, Sen suggests institutional ways to build a market where exchange can be established. Wazim’s confidence in each other’s behavior becomes a factor in the transition of goods to the commons (p. 48). Sen is convinced that skepticism about business behavior’s reliability and moral qualities poses a barrier to recognizing success as a communal achievement (p. 49).
Finally, Sen views ethics as an instrument of consolation. He argues that “the rationale of the self-interest-based market mechanism comes under severe strain” (p. 51). Sen believes that trust and ethical compliance should come first when achieving athletic success because they offset external damaging effects (p. 51). In the case of solid externalities, the value of the social value of labor in decision-making must be established. On this basis, Sen argues that since production is a cooperative activity, the success of any firm is a good that is not tied to “the respective merits of each individual” (p. 52). Consequently, ethical business communication is the basis for successful business practices.
Reason
I will now turn to why Sen’s argument for trust is weak. I am not arguing that adherence to ethical norms does not bring economic benefits or make businesses more socially conscious. However, the connection between ethics and business practice that Sen uses is questionable because the motives for this connection are not fully understood. I believe this link definition goes against the market rules that need to be in place for survival. Although I assume Sen’s article is not entirely motivated because it results from the conditions of the times and the policies involved, I am nevertheless sure that the links between ethics and business practices should be examined from a different angle.
I want to focus first on the claim that nonprofit values are not necessary for success and building trustworthy ethics. At present, the argument about the connection between communist principles of community and the labor economy is weak, given the past experiences of the former Soviet Union. The practical perspectives in these countries show that following one’s interests and putting forward a solid personal position is far more ethical than following vague noncommercial values. Behavioral norms are indeed central to the enterprise (p.48), but they are part of the collaborative development of culture, not just ethics and trust. Finally, not every organization is based on helping: service provision does not go hand in hand with supporting the population’s social needs. Based on this, the exchange function in the marketplace is not the result of ethical compliance, so it is insufficient for success.
Second, it is worth questioning the relationship between the public good as a phenomenon and the company’s compliance with ethical norms – trust. One can agree that a lack of mutual trust between consumers and suppliers slows business. However, confidence in the partnership is only a matter of ethics, which has nothing to do with what kind of benefits the firm produces. Sen’s position on this issue is questionable because it is not entirely clear on what basis a product should become a public good if firms are required to be ethical in their behavior with the consumer regardless of the product or service type. The success of one particular supplier is only the result of the team’s efforts to build relationships with consumers and distributors, which does not automatically endow the product with a public good (p. 49). Goods continue to be competitive because the trust placed in them does not compel the supplier to make the product available to the general public or lower its price. Consequently, trustworthiness and moral business behavior are essential to building a successful business, but it is not related to transforming the commodity into a public good.
Conclusion
Finally, I am convinced that ethics is a tool for building relationships inside and outside the organization. Rationalizing interests based on market dynamics is a normal phenomenon in which the promotion of commercial values is essential for the business’s survival. While Sen believes ethics levels out the damaging effect, we should address the fact that the social significance of labor is not a product of trust between consumer and supplier. Labor is socially significant only if it produces non-competitive goods. Otherwise, labor will always result from the individual’s contribution and the collective as a whole. The use of communist rhetoric on this issue is unacceptable because it would eliminate established communication. On this basis, Sen’s argument for a link between ethics and social value does not appear to be entirely valid.