7 ms·

To boost profits you have to provide more value (in a competitive field). And "more value = social benefit" has been a decent approximation so far. It's not gua

by rafale 5y ago

To boost profits you have to provide more value (in a competitive field). And "more value = social benefit" has been a decent approximation so far. It's not guaranteed to hold true in the future though.

whatshisface 5y ago
A few enormous exceptions to the value = social benefit rule in recent times have been cigarettes, junk food, and the things that lead to superfund sites. We can't get so upset by cigarettes that we lump shelving manufacturers in with Phillip Morris, but we also can't get so excited about shelving that we lump Phillip Morris in with them.
- Aerroon 5y ago
  I don't think that cigarettes can be easily labeled as not having a social benefit. Nicotine has cognitive enhancement effects and it seems to help people with some disorders manage them better.[0] The benefits are to the extent that nicotine has been considered as a treatment for ADHD. Nicotine being generally available could have provided significant amounts of social benefits by allowing people to self-medicate. Current healthcare systems are absolutely not adequate for picking up the slack and that's if the healthcare system is even willing to treat those people (ADHD treatment in some European countries is tricky). While it was certainly bad how much cigarettes were pushed and I do think this caused more harm than good, it still probably had benefits. [0] https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6018192/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6018192/
  - whatshisface 5y ago
    Cigarettes look like a justifiable product at the level of "we roll leaves in paper," or "we give you a drug with side effects no worse than some other psychoactive drugs," but when you get in to the details of how it was actually done (carcinogens added above and beyond the smoke itself for the purpose of enhancing addiction, marketing designed around the well-known "trigger" stimulus response of relapsing drug users, denial of the effects to offload health liabilities to state insurance) it's no longer anything but an errant time in our history which will hopefully not be repeated. It is the prototypical example of the profit motive departing from the public good.
    - Aerroon 5y ago
      Sure, but if cigarettes weren't a thing then nicotine would probably be on the enormously long list of banned substances that you go to prison for possessing. The business is probably what kept it available for regular people. I think as smoking winds down there will be more talk of making nicotine illegal, because that's how our governments operate.
      - whatshisface 5y ago
        "We have to give millions of people lung cancer... to stop our irrational government from banning a relaxing drug" sounds like the plot of a villain from a 1980s Saturday morning cartoon.
        Aerroon 5y ago
        It's not so much that this had to happen, but it's something that may have some social benefit. It's an unfortunate side of a society that accepts banning a wide range of things.
- TeMPOraL 5y ago
  I'd argue the biggest glaring exception is advertising. I'd also add all kinds of rent-seeking behavior, a prime example of which are business models relying on abusing intellectual property regulations. And then you have a whole laundry list of business models and tricks that are socially negative but yield nice profits - various incarnations of "razor and blades" model, or the distressingly common in appliances sector - and now in computing hardware too - practice of replacing parts of a product with lower-quality substitutes in subsequent batches, without changing the SKU. My own opinion is that profits and social value have become mostly misaligned a few decades ago already.
  - whatshisface 5y ago
    Arguably you could go back to the unsanitary meat packing plants of America's industrial revolution to find the first widely known US example of business doing things that they shouldn't to make more money. Someone with more knowledge of world history could go back farther.
simonh 5y ago
Sometimes yes absolutely, but there are social goods that it's not efficient to capture or represent in the form of profits. The most extreme examples are national militaries and policing, but there's also fire services and arguably health care. I know that last one is controversial in the US, but I'm a Brit and a conservative voting one at that, and over here and in Europe generally it really isn't at any significant level. Some enterprises, particularly general social services and infrastructure just work very well as charitable trusts, or non profits. This has been shown to be effective for hundreds of years. Then for-profit enterprises can work alongside them to mutual benefit, such as medical products companies working along with health services. It's just a matter of which model works best in practice in a function, ideology be hanged. As we're on the subject of SpaceX the NASA model worked very well for a while, but ran into the ground with the Shuttle. Now we seem to be back with a productive synergistic relationship between public and private functions.
pinko 5y ago
"more value = social benefit" -- only if you ignore externalities, it seems to me. If companies had to pay for their environmental impact alone, much of the S&P500 would be wildly unprofitable. Leaving aside social externalities which are harder to quantify...
suchow 5y ago
To boost profits you need to extract more value, regardless of whether you provide more.
X6S1x6Okd1st 5y ago
Except if you find a business plan where you increase profits by emitting CO2 which doesn't have a direct cost associated with it, or make people angrier so they look at more ads, or take bets where if you win you get money, and if you lose you get bailed out by the government. There's been plenty of failures of profit seeking as a social good that may have been avoided if companies felt a duty to society beyond profit seeking.

by rafale 5y ago

whatshisface 5y ago

A few enormous exceptions to the value = social benefit rule in recent times have been cigarettes, junk food, and the things that lead to superfund sites. We can't get so upset by cigarettes that we lump shelving manufacturers in with Phillip Morris, but we also can't get so excited about shelving that we lump Phillip Morris in with them.

Aerroon 5y ago
I don't think that cigarettes can be easily labeled as not having a social benefit. Nicotine has cognitive enhancement effects and it seems to help people with some disorders manage them better.[0] The benefits are to the extent that nicotine has been considered as a treatment for ADHD. Nicotine being generally available could have provided significant amounts of social benefits by allowing people to self-medicate. Current healthcare systems are absolutely not adequate for picking up the slack and that's if the healthcare system is even willing to treat those people (ADHD treatment in some European countries is tricky). While it was certainly bad how much cigarettes were pushed and I do think this caused more harm than good, it still probably had benefits. [0] https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6018192/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6018192/
- whatshisface 5y ago
  Cigarettes look like a justifiable product at the level of "we roll leaves in paper," or "we give you a drug with side effects no worse than some other psychoactive drugs," but when you get in to the details of how it was actually done (carcinogens added above and beyond the smoke itself for the purpose of enhancing addiction, marketing designed around the well-known "trigger" stimulus response of relapsing drug users, denial of the effects to offload health liabilities to state insurance) it's no longer anything but an errant time in our history which will hopefully not be repeated. It is the prototypical example of the profit motive departing from the public good.
  - Aerroon 5y ago
    Sure, but if cigarettes weren't a thing then nicotine would probably be on the enormously long list of banned substances that you go to prison for possessing. The business is probably what kept it available for regular people. I think as smoking winds down there will be more talk of making nicotine illegal, because that's how our governments operate.
    - whatshisface 5y ago
      "We have to give millions of people lung cancer... to stop our irrational government from banning a relaxing drug" sounds like the plot of a villain from a 1980s Saturday morning cartoon.
      - Aerroon 5y ago
        It's not so much that this had to happen, but it's something that may have some social benefit. It's an unfortunate side of a society that accepts banning a wide range of things.
TeMPOraL 5y ago
I'd argue the biggest glaring exception is advertising. I'd also add all kinds of rent-seeking behavior, a prime example of which are business models relying on abusing intellectual property regulations. And then you have a whole laundry list of business models and tricks that are socially negative but yield nice profits - various incarnations of "razor and blades" model, or the distressingly common in appliances sector - and now in computing hardware too - practice of replacing parts of a product with lower-quality substitutes in subsequent batches, without changing the SKU. My own opinion is that profits and social value have become mostly misaligned a few decades ago already.
- whatshisface 5y ago
  Arguably you could go back to the unsanitary meat packing plants of America's industrial revolution to find the first widely known US example of business doing things that they shouldn't to make more money. Someone with more knowledge of world history could go back farther.

simonh 5y ago

Sometimes yes absolutely, but there are social goods that it's not efficient to capture or represent in the form of profits. The most extreme examples are national militaries and policing, but there's also fire services and arguably health care. I know that last one is controversial in the US, but I'm a Brit and a conservative voting one at that, and over here and in Europe generally it really isn't at any significant level. Some enterprises, particularly general social services and infrastructure just work very well as charitable trusts, or non profits. This has been shown to be effective for hundreds of years. Then for-profit enterprises can work alongside them to mutual benefit, such as medical products companies working along with health services. It's just a matter of which model works best in practice in a function, ideology be hanged. As we're on the subject of SpaceX the NASA model worked very well for a while, but ran into the ground with the Shuttle. Now we seem to be back with a productive synergistic relationship between public and private functions.

pinko 5y ago

"more value = social benefit" -- only if you ignore externalities, it seems to me. If companies had to pay for their environmental impact alone, much of the S&P500 would be wildly unprofitable. Leaving aside social externalities which are harder to quantify...

suchow 5y ago

To boost profits you need to extract more value, regardless of whether you provide more.

X6S1x6Okd1st 5y ago

Except if you find a business plan where you increase profits by emitting CO2 which doesn't have a direct cost associated with it, or make people angrier so they look at more ads, or take bets where if you win you get money, and if you lose you get bailed out by the government. There's been plenty of failures of profit seeking as a social good that may have been avoided if companies felt a duty to society beyond profit seeking.