Business Government Society Relationship

Describe the Market Capitalism Model as it relates to the Business-Government-Society relationship.

• Government regulation should be limited.

o Government should aim at improving its competence and performance. However extra attention has to be directed towards the fact that governments are no longer the only power centers.

o There are functions that can only be performed by the government such as defense and maintaining law, order and justice.

o Ground rules set have to be followed by everybody in terms of laws and regulations of diverse nature.

o Certain activities performed no efficiently by government when functions or services can be done more efficiently by outsiders should be privatized.

o The economic policy is no longer sourced and influenced solely by the national state but among others, region, world economy of money, credit and investments and transnational business.

• Markets will discipline private economic activity to promote social welfare

o The society, community and family are considered to behave as conserving institutions usually maintaining stability, preventing or slowing down the processes of change

o Market maximization rather than the profit maximization is the goal of the new transnational economy

• The proper measure of corporate performance is profit

o Money flows with their dynamics rather than trade in goods and service, mainly shape the transnational economy.

o Labor, land and money play secondary roles. It is management on which the long-term competitive position of the countries should be based on.

o The capitalists have become an economically irrelevant group in developed countries and something