CHAPTER SEVEN ENVIRONMENT Business and ecology Ecology refers to the interrelationships among organisms and their environments.

The interrelationships imply the interdependence of each organism to each other. The growth of technology and companies has interrupted the ecosystem as resources are used as if there are no limitations. Businesss traditional attitudes toward the environment Traditionally, the environment has been considered as free and non limited resources. This belief has promoted wasteful consumption of natural resources. The consequences of this attitude have led to the tragedy of the commons. Commons can be referred to public goods like water, air and wilderness. Problems occur when individuals and companies follow their self-interest to use the commons without considering the destruction of public domain. The tragedy of the commons also illustrates the more general point that there can be a difference between private costs and social costs of a business activity. The disparity between public costs and social costs is called a spillover or externality. Companies tend to overlook spillovers. This is a problem because the price of an item might not reflect the true cost of the production. It becomes a moral problem because the purchasers are not paying full costs and the remaining balance is unfairly imposed on other people. Spillover also exists due to the depletion of resources rather than pollution. Business often derives a profit from a product without considering the overall social cost the damage the product or the production process has caused to the environment and human populations. The ethics of environmental protection The importance of protecting the environment is now the self-interest of everyone. Though proper steps have been carried out, there is still a free-rider problem. Individuals and companies may rationalize that they only contribute so little to the problem of pollution thus, not making any difference. These companies benefit from the effort of others to prevent pollution.

The costs of pollution control In order to determine the costs of pollution control there are several questions that need to be considered. 1) What is the quality of the environment? 2) What is required to obtain the environment? 3) What should be done to improve the environment? The costs of pollution control require cost-benefit analysis. It is a device used to determine whether it is worth it to incur a particular cost. However, the use of cost-benefit analysis is complicated and involves controversial factual assessments and value judgments. In order to overcome the boundaries a new discipline of ecological economics attempt to calculate the value of an ecosystem in terms of what it would cost to provide benefits and services. Who should pay the costs? 1) Those responsible for causing the pollution ought to pay. 2) Those who stand to benefit from protection and restoration should pick up the tab. Those responsible: Business has profited greatly from treating the environment as a free good, but consumers have paid lower costs for products. Some would blame consumers, not businesses, for pollution because they create demand for products whose production impairs the environment. But this argument fails to recognize the deep-rooted causes of pollution population growth, increasing urbanization, and rising affluence.

Those who would benefit: Critics of this argument point out that every individual, rich or poor, and every institution, large or small, stands to benefit from environmental protection and restoration, albeit not necessarily to the same degree. The problem: If pollution concerns all of us to a different degree, how would we determine the amount individuals and companies should pay, based on the degree to which they benefit?

Achieving our environmental goals To achieve environmental goals, three steps can be taken which are: a) Regulations The use of direct public (state and federal) regulation and control in determining how the pollution bill is paid. Four drawbacks: Requiring firms to use the strongest feasible means of pollution control is problematic. Although regulations treat all parties equally, this often comes at the cost of ignoring the special circumstances of particular industries and individual firms. Regulation can take away an industrys incentive to do more than the minimum required by law. No polluter has an incentive to discharge less muck than regulations allow. No entrepreneur has an incentive to devise technology that will bring pollution levels below the registered maximum.) Regulation can also cause plants to shut down or relocate. b) Incentives A widely supported approach to the problem of cost allocation for environmental improvement through government investment, subsidy, and general economic incentive (e.g. by means of tax cuts, grants or awards). The advantage is that it minimizes regulatory interference and coercion. The disadvantage is that it moves slowly, pays polluters not to pollute, and is not always cost-effective. c) Pricing mechanisms and Pollution permits Also called effluent charges, they spell out the cost for a specific kind of pollution in a specific area at a specific time. Prices are tied to the amount of damage caused so may vary from place to place and time to time. Allow companies to discharge a limited amount of pollution or trade pollution rights with other companies. Critics argue that this approach entails an implicit right to pollute, and reject this as immoral. Delving deeper into environmental ethics To satisfy its disproportionate consumption of nonrenewable resources, companies turn to foreign lands.

This raises two critical moral questions: How is the continued availability of foreign resources to be secured? Does any nation have a right to consume the worlds irreplaceable resources at a rate so grossly out of proportion to the size of its population?

Obligations to future generations: A broader view of environmental ethics considers our duties to other societies and upcoming generations. Some say we must respect the right of future generations to inherit an environment that is not seriously damaged. Others argue that by putting ourselves in the original position, we can balance our interests against those of our descendants.

The value of nature: A radical approach to environmental ethics challenges the humancentered assumption that preserving the environment is good only because it is good for us. Adopting a naturalistic, non-anthropocentric ethic would change our way of looking at nature, but many philosophers are skeptical of the idea that nature has any intrinsic value. Factory farming: Businesss largest and most devastating impact on animals is the production of animal-related productsin particular, meat. The economizing of the meat and animal-products industries leads to their treating animals in ways that many reject as cruel and immoral. Is it wrong to eat meat? The answer depends on whether animals have moral rights, and whether and to what extent these rights are on a par with human rights.