Managerial Economics W5A

· Published: August 1986

A critique of Milton Friedman's essay ‘the social responsibility of business is to increase its profits’

· Thomas Mulligan  

Journal of Business Ethics  volume 5, pages265–269(1986) Cite this article

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Abstract

The main arguments of Milton Friedman's famous and influential essay are unsuccessful: He fails to prove that the exercise of social responsibility in business is by nature an unfair and socialist practice.

Much of Friedman's case is based on a questionable paradigm; a key premise is false; and logical cogency is sometimes missing.

The author proposes a different paradigm for socially responsible action in business and argues that a commitment to social responsibility can be an integral element in strategic and operational business management without producing any of the objectionable results claimed by Friedman.

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Affiliations

1. The Fuqua School of Business, Duke University, 27706, Durham, NC, U.S.A.

Thomas Mulligan

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Thomas Mulligan is an Assistant Professor at The Fuqua School of Business, Duke University, in the areas of Manufacturing Management Systems and Business Ethics. He has a Ph.D. from Northwestern University in the field of Philosophy and has worked as an educator, manager, and consultant in the manufacturing and software industries.

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Mulligan, T. A critique of Milton Friedman's essay ‘the social responsibility of business is to increase its profits’. J Bus Ethics 5, 265–269 (1986). https://doi.org/10.1007/BF00383091

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· Issue DateAugust 1986