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Free «Applying Ethical Theory to Production and Marketing» Essay Sample

Velasquez indicated that "many people believe that consumers have to be protected from injury by the operations of free and competitive markets and that neither governments nor businesspeople have to take special steps to deal with these issues" (2005 p. 262). They continue to say free markets promote an allocation, use ad distribution of goods that are in a way respectful of rights and efficiently productive of maximum utility for those who are involved n the market. Velasquez (2005) indicated that it is important to note that when sellers provide products to their consumers they should take the incentive to take care f their wishes (p. 262).

In addition, Velasquez (2005) says that government regulations should play an integral part in forcing producers to build more safety into their products as consumers demand. In this context only consumers are able to say what value they place on safety and therefore they should be allowed to register their preferences through their free choices in the markets and not be coerced by businesses or governments into paying for safety levels they want to be incorporated in their products (Velasquez, 2005).



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The contract view as indicated by Velasquez (2005) "is the relationship between a business fir and its customers which is actually a contractual relationship and the firm's moral duties to the customer" (p. 265). When a consumer buys a product the contract view holds the consumer voluntarily enters into a sales contract with the business firm (Velasquez, 2005). In this case the firm freely accepts to give the consumer a product with certain characteristic. In turn the firm under this contract accepts the duty to provide a product with those characteristics. Velasquez (2005) further says that "the duty to comply is according to the contract view is the duty to provide consumers with a product that lives up to those claims that the firm expressly makes about the product which made the consumer to enter into the contract freely" (p. 266).

The social costs view holds that a manufacture should pay the costs of any injuries sustained though any defects in the products, even when the manufacturer exercised all due care in the design and manufacture of he the product (Velasquez, 2005). Velasquez (2005) further says that "a manufacturer has a duty to assume the risks of even those injuries that arise out of defects in the products that no one could have foreseen or eliminated" (p. 278). The theory thus implies that let the seller take care (Velasquez, 2005).

Market mechanism should create markets which make businesses and consumers to obtain information about the products manufactures provide or make (Velasquez, 2005). Businesses have duty to comply about the products provided by the markets because consumers may not have the resources to obtain the information on their own (Velasquez, 2005). For example this can be testing several competing brands to determine which product provides the most safety cost.

According to Velasquez (2005) businesses have a duty to comply, disclose, and not misrepresent or coerce information about the products because consumers cannot know in advance what they are buying when they information about a certain products. Velasquez (2005) thus says that "markets alone are not able to support organizations that can provide consumers with the information they need about the products" (p. 278).

Velasquez (2005) says that the "utilitarian arguments for the social costs view hold that external costs of injuries resulting from unavoidable defects of design of an artifact constitute part of the costs society must pay for producing and using an artifact" (p. 273). In this context the first argument is that by the virtue of having the manufacture to pay or bear the costs that result from these injuries as well as design costs implies that all costs are internalized and added on as part of the price of the product (Velasquez, 2005). Also since all the costs are internalized the cost of producing and using the artifact, market forces ensure that the product is not overproduced and resources are not wasted on it.

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The other argument against social costs according to Velasquez (2005) is that it focuses on the financial burdens and it imposes on the manufacture and the insurance carriers. As a result critics say that a big number of consumers sue manufacturers for compensation of injuries sustained while using the product even when the manufacturer took all due care to ensure that the product was safe (Velasquez, 2005). The last argument is that the social costs theory will encourage carelessness in consumers because the social costs theory relieves consumers of the responsibility of paying for their own injuries.

There are several social issues raised from advertising. First it is based on who pays for the advertising costs, and what the consumer actually gets for their advertising dollar (Velasquez, 2005). Velasquez (2005) say that it is believed that in the end advertising costs are mostly covered by the prices consumers pay for the goods they buy that is when the consumer buys. An ethical dilemma about advertising is that in most cases consumers end up buying what or things they should not buy. Velasquez (2005) continue to say that advertisements insult intelligence and that advertisements do not presents the truth.

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Velasquez (2005) says that advertising debases the tastes of the public by presenting irritating and aesthetically unpleasant displays. Personal efforts are normally diverted from aims and objectives which are more likely to increase the happiness of people and are instead channeled into expanded material consumption (Velasquez, 2005). Velasquez (2005) says that advertising is considered as a wasteful. This is because advertisements are not used to improve the product but they merely persuade people to buy it (Velasquez, 2005). He continues to say that social issues are also based on the fact that resources consumed b advertisements do not add anything to the utility of the product.


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