Ethics in Capitalism

Ethics in capitalism

Capitalism is an economic system, which is based on the principles of infinite expansion and profit maximization. There is no clear answer for the question of whether capitalism is ethical or not. Based on political religious system, capitalism is ethical since being successful is a sign to be elected to the heaven. Capitalism is also considered to be ethical since it drives technological advancement through competitions and contributes to the economy growth and average living standard particularly for people in developing countries such as China and Vietnam. On the other hand, because of the ultimate aim of maximizing profit, under capitalism, the market participants are bending the rules or going around regulations, which is unethical. Some corporations and hedge fund managers borrow money even when they know that they cannot payback. Capitalism also creates unequal chances, which provide advantages to wealthier people. As a result, the wealth disparity in the society is increasing. The unethical problem becomes more severe when the capitalism allows the participant to avoid contributing to the society e.g. tax heaven. Human’s greed is argued to be one of the reasons for the capitalism unethicality.

From my point of view, the unethical aspect of capitalism is that it provides room for the greedy nature of human being. Financial crises are examples for how human greed under capitalism drives economies into recessions.

In Vietnam, since 1990, many corporations have been privatized and their owners are now aiming to maximize their profit. As a result, there are more and more unethical cases such as using low quality ingredients in production, leading to fatal incidents. Nevertheless, thanks to competitions and business opportunities under the new system, the economy growth rate is about 6-7%, which help to increase living standards.