Corporations only exist within a legal governance infrastructure that permits incorporation and shapes externalities into internalities. Without such infrastructure you have warring tribes/gangs, not corporations.
The ways in which this shareholder value maximization has already seriously damaged the world and compromised the quality of human life are myriad and easily observable: pollution, climate change, and other such externalities. Companies’ disregard for human suffering further enhances this comparison.
This is the naive leftist/marxist take. In practice communist countries such as Mao era China outpaced the west in pollution and environmental destruction.
Neither government bureaucracies or corporations are aligned by default—that always require careful mechanism design. As markets are the pareto efficient organization structure, they also tend to solve these problems quicker and more effectively with appropriate legal infrastructure to internalize externalities.
Skepticism about the alignment of government and the incentives thereof has existed for almost as long as governments have. Elections, for example, are a crude but better-than-nothing attempt to align political interests with public interests, and much ink has been spilled on the subject of improving this alignment and even whether alignment to the general public opinion is a good idea.
Far less such discussion has occurred in the case of extremely large companies, as they are a relatively newer concept.
Corporations only exist within a legal governance infrastructure that permits incorporation and shapes externalities into internalities. Without such infrastructure you have warring tribes/gangs, not corporations.
This is the naive leftist/marxist take. In practice communist countries such as Mao era China outpaced the west in pollution and environmental destruction.
Neither government bureaucracies or corporations are aligned by default—that always require careful mechanism design. As markets are the pareto efficient organization structure, they also tend to solve these problems quicker and more effectively with appropriate legal infrastructure to internalize externalities.
Skepticism about the alignment of government and the incentives thereof has existed for almost as long as governments have. Elections, for example, are a crude but better-than-nothing attempt to align political interests with public interests, and much ink has been spilled on the subject of improving this alignment and even whether alignment to the general public opinion is a good idea.
Far less such discussion has occurred in the case of extremely large companies, as they are a relatively newer concept.