Selfishness, Greed and Capitalism

Selfishness, Greed and Capitalismthe employees of Kobe Steel are apparently honest, Changfeels vindicated in his view that the economists are wrong.But surely the company has disincentives as well asincentives? Even if the character of the staff at Kobe Steelis beyond reproach, it would be surprising if the companydoes not have regulations and a disciplinary process whichwill occasionally result in dismissals. It may also havesome form of video surveillance system on its premises.Businesses have regulations, surveillance and disciplinaryprocedures not because they assume that everybody is agreedy crook but because a few people are. 4 We have lawsagainst murder and theft for the same reason – to dealwith a minority of criminals, not because we assume thateverybody is a ‘selfish, amoral agent’.Safeguards against misconduct in the workplaceare perfectly consistent with the free-market view thateconomic life be regulated to prevent corruption, extortionand theft. For most employees, the benefits theyreceive from working hard, combined with the threat of4 As it happens, not every person who has worked at Kobe Steel isimpeccably well behaved. In 2006, an investigation revealed that‘data on soot and smoke released by one of its plants were falsifiedfrequently over a period of 30 years’ (Japan Times, 2006). In 2009,the chairman resigned over ‘inappropriate donations’ given to politicians.In 2002, six former Kobe Steel executives and a corporateracketeer agreed to pay 310 million yen to the company after apayoff scandal. In the latter case, the judge remarked: ‘Top executivesof a company cannot avoid responsibility by simply makingthe excuse that they did not know (about the wrongdoings of theirsubordinates)’ (Japan Times, 2002).14