William J. Baumol on Social Responsibility

Recently named by Thomson Reuters as one of the scholars predicted to be 2014 Nobel Laureate, William J. Baumol has led an active career as an American economic scholar. Dr. Baumol, now in his early nineties, is Harold Price Professor of Entrepreneurship and Academic Director of the Berkley Center for Entrepreneurship and Innovation at New York University, as well as Senior Economist and Professor Emeritus at Princeton University. He is the author of over 45 books. He recently wrote an article which appeared in Business and Society entitled “On the Appropriate Social Responsibilities of Successful Entrepreneurs.”

The abstract:

This article offers proposed guidelines intended to protect the public interest in relationship to the advocated social responsibilities of successful entrepreneurs. The author argues that the most effective approach, then, is not preaching about obligations but, rather, establishing financial incentives for doing well by doing good. One example is the U.S. patent system. Another is a redesigned tax system that uses imposts to make socially damaging activities expensive, while reducing the financial burden on virtuous behavior.

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