The Influence of Economic, Political, and Social Factors on Firms
The long controversy exist over the influence of economic , political
and social factors on the success of the firms. With many economist
believing that economic factors such as management structure
contribute to the success of the firm. Karl Marx (1976)[1] and other
economist argued that economic factors are not the sole determiner of
firm’s success. Marx believes that political, social and economics
plays a part in making the firm to be effective. So the following
paper will address the question of whether political, economic or
social factors contribute to success of the firms. The discussion of
economic, political and social factors will be based on the argument
between Marglin and Landers.
Competition creates a spur for companies to innovate, improve
efficiency and drive down prices. Competition is a model of industrial
structure in which many firms compete in the supply of a single
product in a competitive environment where only the fittest or most
affective firm succeeds. Before going further I will like to emphasise
the competition I’m referring to is perfect competition where new
firms can enter the market if it appears profitable[2]. Because of
insignificant barrier to entry firms are faced with challenge to
innovate and to improve efficiency. As stated by the neo-classical
theory of the firm it is in the interest of the firm to keep the
marginal cost as low as possible. The need to lower the average total
cost persuaded firms to look for efficient form of production.
Competition from rivals forced firms to adopt management systems that
will allow them to outperform their rivals .I clearly agree with
Landers that the new management system emerged because its
effectiveness[3]. Firms adopted the putting out system because it
allows them to have edge over other firms The creation of the
factories overcome the control that workers had over their work in the
early phase of capitalist through the cottage system. Under the
cottage system workers were working from home and the domestic
craftsmen was master of his time. The lack supervision under the
cottage industry meant that workers had no control over how much
worker produced per day. Firms were not benefiting because it was easy
for workers to steal raw materials. As stated by Karl Marx and the
o...
... middle of paper ...
... as mentioned by Marglin both social and economic factors
play a part , but they depend on competition .For example in the
factory system firms exploited workers because of competition if I
wasn’t because of competitions firms wouldn’t have exploited
workers.
[1] Landers ,”what do bosses really do ?p.591
[2] Landers ,”what do bosses really do ?p.591
[3] Marglin “What do bosses do ?p.18
[4]Marglin “what do bosses do ?p.16-17
[5] Marglin what do bosses do?
[6] Chandler (1992)managerial enterprise and competitive capabilities,
business history .p16
[7] Elger ,T & Fairbrother , P (1992)fordism and flexibility .p.40
REFERENECE LISTS
Chandler , A .(1992),”managerial enterprise and competitive
capabilities; Business history review , vol.58,no .4.
Elger, T & Fairbrother ,P.(1992),’inflexible flexibility ‘ in N.
Gilbert et al (eds) Fordism and flexibility :Division and
Change(London , Macmillan)
Lazonick,w.(1991), Business organization and the myth the economy.
Landers, D.(1986), “What do bosses really do” The journal of economic
history
Marglin.S.(1976)’What do bosses do ‘ .In A .Gorz (ed),The division of
Labour (Brighton , Harvester)
Henry Ford and Walter Reuther are two of the biggest names in the world of automobile industries and organized labor. They were both activists in their own way. Also, they were completely different from each other, one could even argue that they were opposites. Their ideas were contradicting, but still both of them had positive effects on society.
Most companies’ primary goal is to maximise profit in order to remain competitive in the market. The concern usually arises in the measures and approaches companies take to achieve that goal and how it will benefit in the short-term and long-term process. (Eccles, 2011)
Stalin and many other dictators at this time are becoming totalitarian dictators. This is because of many aspects about their lives they had and the state of the country they controlled. In Stalin’s case, Russia is in ruins and it is in chaos. He also has a life that molds him into a communist and paranoid person. He also using his administrative skills and maneuvering establishes a place for him in his party. So Stalin was successful in becoming a totalitarian dictator and turning Russia into a communist state because Russia was in chaos, he maneuvers to establish a powerful place in the communist party, and his reign of terror gets rid of all the enemies he has.
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Kogut, B. and Zander, U. (1993). Knowledge of the Firm and the Evolutionary Theory of the MNC, Journal of International Business 24(4), pp. 625-645
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Peter Paul Rubens, the epitome of influential educated artist of the 17th century, studied the “works of Veronese, Tintoretto, Titian and Caravaggio.” (Baroque Art n.d.) and even went through the hassle of reproducing one of Leonardo’s drawings to show that he had understood the composition and style of Italian Renaissance art. Having been raised in Belgium, Peter Paul Rubens was familiar with Flemish Traditional art which was primarily landscape and portraiture, consisted of vivid detail with reserved composition.
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