Business Ethics and Eleven Categories of Merit Goods

In this chapter I add the concept of merit goods to the concepts of public goods and the free rider problem as one more economic concept that can be useful in the vocabulary of business ethics. Musgrave defines merit goods as goods that are so meritorious that the government has the right to interfere with consumer preferences. Thus the government can subsidize education and even make it obligatory. Musgrave (and I agree) stresses the fact that the concept of public goods is quite different in that in the provision of public goods the government intends to respect the wishes of consumers. I then produce a Kantian argument to justify and limit merit goods and I defend eleven categories of merit goods. I provide an example of a failed merit good implementation. The food business was successful in preventing the government’s implementation of the merit good program for breast feeding. Our question is whether, and when, business leaders have the obligation not to try to stop the implementation of a proven merit good. At the end of the chapter I argue that the idea of merit good expands the notion of stakeholder beyond what the concept of public good is doing.