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Freedom trumps profit: a liberal approach to business ethics

Author

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  • Andreas Ostermaier

    (University of Southern Denmark)

  • Dominik Aaken

    (University of Salzburg)

Abstract

Liberalism is denounced by its critics as an ideology that advocates profit seeking and breeds economic crises. Even much of the CSR literature is pitched against liberalism. Liberalism, however, is about freedom much more than profits. It both legitimizes and confines contracting in markets. Specifically, contracts are legitimate if they are based on voluntary consent and thus reflect contractors’ freedom. We propose a broad understanding of freedom and derive criteria as guidance for contractors to establish voluntary consent. For illustration, we discuss the example of sweatshops. We suggest that liberalism is a potentially valuable resource in developing CSR theory.

Suggested Citation

  • Andreas Ostermaier & Dominik Aaken, 2020. "Freedom trumps profit: a liberal approach to business ethics," Journal of Business Economics, Springer, vol. 90(5), pages 947-962, June.
    • Handle: RePEc:spr:jbecon:v:90:y:2020:i:5:d:10.1007_s11573-020-00994-y
    DOI: 10.1007/s11573-020-00994-y
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    References listed on IDEAS

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    More about this item

    Keywords

    Business ethicss; Contracts; Freedom; Liberalism;
    All these keywords.

    JEL classification:

    • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
    • B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology
    • K12 - Law and Economics - - Basic Areas of Law - - - Contract Law

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