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S I X T H E D I T I O N
BUSINESS AND ITSENVIRONMENT
David R Baron
Stanford University
PEARSON
Pearson Education International
Contents
List of Cases xvi
Preface xix
PART I: STRATEGY AND THE NONMARKET ENVIRONMENT 1CHAPTER 1 Market and Nonmarket Environments 1
Introduction 1
The Environment of Business 2
The Role of Management 3Market and Nonmarket Environments 4
Analysis of the Nonmarket Environment: The Four I's 5The Nonmarket Environment of the Automobile Industry 5
Issues 5 • Interests 8 • Institutions 9 • Information 10Change in the Nonmarket Environment 11Anticipating Change in the Nonmarket Environment 13The Nonmarket Issue Life Cycle 13
EXAMPLE: GRADUATION CARDS 14
Summary 16Cases 17
The Nonmarket Environment of the Pharmaceutical Industry 17The Nonmarket Environment of McDonald's 20The Nonmarket Environment of Google 25
CHAPTER 2 Integrated Strategy 33Introduction 33
Strategy in the Nonmarket Environment 33The Importance of Nonmarket Strategy 33 • Competition and Change in the Nonmarket Environment 35• Strategy and the Nonmarket Issue Life Cycle 36 • Strategies and Borders 36
Integrated Strategy 37Google and the Spectrum Auction 38EXAMPLE: DIRECT-TO-CONSUMER ADVERTISING AND INTEGRATED STRATEGY IN THE
PHARMACEUTICAL INDUSTRY 40
Approaches to Integrating Market and Nonmarket Strategies 41
Nonmarket Positioning 42Nonmarket Positioning and Market Strategies 43EXAMPLE: EBAY'S POSITIONING IN LEGAL SPACE 44
Positioning Spaces 46 • The Perils of Positioning 47Nonmarket Capabilities and Reputation 48A Framework for the Analysis of Nonmarket Issues 49
EXAMPLE: CITIBANK AND CREDIT CARDS FOR UNDERGRADUATES 51
Organization of the Nonmarket Strategy Function 52Summary 53Cases 54
Exclusive Resorts: Entrepreneurial Positioning and Nonmarket Defense 54Envirotest Systems Corporation (A) 57Molecular Insight Pharmaceuticals: Integrated Strategy for a Development Stage Molecular
Medicine Company 61
vi Contents
CHAPTER 3 The News Media and Nonmarket Issues 66Introduction 66The Role of the News Media in Nonmarket Issues 66Messages and Their Interpretation 68A Theory of News Media Coverage and Treatment 69
Intrinsic Audience Interest 69 • Societal Significance 70 • Combining the Perspectives 70
Extending the Theory 72Newsworthiness 72 • The Cost of Coverage 73 • Balance and Fairness 73
The Nature of the News Media 74News Organizations as Businesses 74 • The Profession 74 • Does the News Media Treat Issues Selectively? 75• Bias, Accuracy, and Fairness 76 • The Internet and Citizen Journalism 77
Business Interactions with the News Media 78The Need for Information 78 • Media Strategies 78 • Responses and Media Vacuums 79• Media Interviews 79 • Anticipating Issues 80 • Unanticipated Events 81
Recourse in Disputes with the Media 81Private Recourse 81EXAMPLE: PROCTER & GAMBLE AND NEIGHBOR TO NEIGHBOR 82
Recourse to the Law: Defamation and Libel 83 • Political Recourse 84Summary 85Cases 86
General Motors: Like a Rock? (A) 86Illinois Power Company (A) 88
CHAPTER 4 Private Politics 90Introduction 90Campaigns 91
EXAMPLE: PIZZA HUT AND HEALTH INSURANCE REFORM 93
Private or Public Politics? 95Activist Strategies 96
Advocacy Science 98 • Target Selection 98EXAMPLE: FISH FARM ACTIVISM 99
A Generic Strategy of Activists 100Activist Organizations 101 0
Activists and Their Organizations 101 • Greenpeace 102Interacting with Activist Organizations 103
Assessment 103 • Strategy and Negotiations 104EXAMPLE: NEGOTIATING WITH ACTIVISTS: ONBANK 106
Challenging the Activists 106Summary 107Cases 109
Shell, Greenpeace, and Brent Spar 109Nike in Southeast Asia 112Anatomy of a Corporate Campaign: Rainforest Action Network and Citigroup (A) 115Anatomy of a Corporate Campaign: Rainforest Action Network and Citigroup (B) 118
CHAPTER 5 Crisis Management 120Introduction 120
The Nature and Causes of Crises 120
The Pattern of Crisis Development 121
EXAMPLE: PEPSICO AND THE SYRINGE EPISODE 124
Components of a Crisis Management Program 125Avoidance 126 • Crisis Preparedness 127 • Root Cause Analysis 128 • Response 129 • Resolution 132
Summary 133
Contents vii
Cases 135Buffalo Savings Bank (A) 135Mattel: Crisis Management or Management Crisis 136Merck and Vioxx 140
PART I Integrative Case: Wal-Mart: Nonmarket Pressure and Reputation Risk (A) 144
PART II: PUBLIC POLITICS AND NONMARKET STRATEGY 153CHAPTER 6 Nonmarket Analysis for Business 153
Introduction 153A Framework for the Analysis of Nonmarket Action in Public Politics 154
Interests and Interest Groups 154 • The Amount of Nonmarket Action 155 • The Demand forNonmarket Action 155 • The Costs and Effectiveness of Nonmarket Action 156• The Distributive Politics Spreadsheet 158
The Nature of Political Competition 159EXAMPLE: INTERNET WINE SALES 161
Institutions and Institutional Officeholders 162Moral Determinants of Collective Action 162Boeing in a Pickle 162Analysis of Boeing in a Pickle 164
The Nonmarket Issue 164 • Distributive Consequences 165 • Boeing's Nonmarket Agenda andObjectives 166 • The Nature of the Politics 167 • Interests and the Demand for Nonmarket Action 167• The Supply Side 167 • The Distributive Politics Spreadsheet 168 • Institutions and InstitutionalOfficeholders 168 • Nonmarket Strategy Formulation 170 • The Outcome 171
Summary 171
Appendix A: Nonmarket Action and the Free-Rider Problem 173
Appendix B: The Organization of Congress 175Cases 181
Tobacco Politics 181Scrubbers and Environmental Politics 183Repeal of the Luxury Tax 184
CHAPTER 7 Nonmarket Strategies for Government Arenas 185Introduction 185Responsible Nonmarket Action 186
Criticisms of Business Nonmarket Action 186Nonmarket Strategy Formulation 189
Managers and Nonmarket Strategies 189 • Implementation 194Understanding Outcomes 195Generic Nonmarket Strategies 196
Representation Strategies 196EXAMPLE: TOSHIBA AND TRADE SANCTIONS 197
Majority-Building Strategies 199 • Informational Strategies 202 • Public Officeholders as Targets ofNonmarket Strategies 203EXAMPLE: CHINA AND MOST FAVORED NATION STATUS 204
Institutions, Interests, and Strategy Choice 205Institutions and Responsiveness 205 • Interests: Client and Interest Group Politics 205
Summary 206Appendix: The Politics of the Extension of Daylight Saving Time 208Cases 212
Federal Express and Labor Organization 212Carried Interest Taxation 213Wal-Mart and Its Urban Expansion Strategy 217
• vi i i Contents
CHAPTER 8 Implementing Nonmarket Strategies in Government Arenas 220Introduction 220Lobbying 220
EXAMPLE: PACIFICARE'S NONMARKET PORTFOLIO 221
The Nature of Lobbying 222 • Technical and Political Information 223 • Credibility andRelevance of Information 224 • Access 225 • Timing and Focus 226 • GovernmentAllies 226 • Controls on Lobbying 226
Electoral Support 227Myths and Realities of Campaign Financing 228 • Election Financing Laws 228 • The Pattern ofCampaign Contributions 229 • Purposes of Campaign Contributions 230
Grassroots and Constituency Campaigns 231Mobilization 231 • Business Grassroots Campaigns 232 • The Effectiveness of Grassroots Programs 232
Coalition Building 233Peak Associations 233 • Trade Associations 234 • Ad Hoc Coalitions 235• Coalitions and Consensus 235EXAMPLE: PHARMACEUTICAL POLITICS 236
Testimony 236Public Advocacy 237Judicial Actions 238Organizing for Nonmarket Effectiveness 239Developing Nonmarket Capabilities 239Summary 240Cases 242
Responsible Lobbying? 242Internet Taxation 247Pharmaceutical Switching 252
PARTII Integrative Case:FuelEconomy Standards2007 259
PART III: GOVERNMENT AND MARKETS 265CHAPTER 9 Antitrust: Economics, Law, and Politics 265
Introduction 265
Antitrust Law 267The Antitrust Statutes 267EXAMPLE: MONOPOLY 269
Exemptions 269Enforcement of the Antitrust Laws 270
Government Enforcement 270 • Private Enforcement 272 • Per Se Violations and the Rule of Reason 273Antitrust Thought 274
The Structural Approach 275 • The Chicago School 277 • The New IO Approach 278Examples of the Differences in Antitrust Thought 280
Vertical Arrangements 280 • Predatory Pricing and Entry Deterrence 282 • Collusion andPrice-Fixing 283 • Mergers and Merger Guidelines 284
Compliance 286The Politics of Antitrust 287Summary 288Cases 289
Price Fixing in the Airways 289The Staples-Office Depot Merger? 290The Microsoft Antitrust Case 294
CHAPTER 10 Regulation: Law, Economics, and Politics 302Introduction 302Periods of Regulatory Change 303
Contents ix
The Constitutional Basis for Regulation 304Regulatory Commissions and Agencies 305Delegation, Rule Making, Due Process, and Discretion 306The Nonmarket Environment of Regulatory Agencies 307
EXAMPLE: REGULATORY RULE MAKING IN THE BUSH ADMINISTRATION 309
Explanations for Regulation 310
Market Imperfections 310Natural Monopoly 310 • Externalities 312 • Public Goods 313 • Asymmetric Information 313• Moral Hazard 314 • Government Imperfections 315
The Political Economy of Regulation 316Capture and Rent-Seeking Theories 316 • Fairness 316 • Other Public Purposes: Media OwnershipRules 317 • Preemption 318
A Nonmarket Theory of Regulation 318EXAMPLE: THE POLITICAL ECONOMY OF REGULATION: ATVS 319
Redistribution and Cross-Subsidization 320Cost-of-Service Regulation 320Deregulation 321
Telecommunications 321 • Electric Power 323 • Auctions 324Summary 325Cases 326
The FCC and Broadband Regulation 326Enron Power Marketing, Inc., and the California Market 330The FCC Media Ownership Rules 332
CHAPTER 11 Environmental Management and Sustainability 337Introduction 337 ;
The Environment and Sustainability 337
Goals and Actions 337 • Global Climate Change 338 • Policy 338 • Tradeoffs 339
Socially Efficient Control of Externalities 340The Coase Theorem 340EXAMPLE: THE COASE THEOREM 342
Transactions Costs and the Limits of the Coase Theorem 343
Cap-and-Trade Systems 344 • >
Cap-and-Trade Systems to Address Acid Rain 345Global Climate Change and Emissions Trading Systems 346
The United States and Carbon Emissions 347 • Emissions Trading in the European Union 347• Emissions Trading Within BP pic (British Petroleum) 348
Regulation as Opportunity 348Government Policy: The EPA 349
Enforcement 350 • Standards Setting and Engineering Controls 351 • Incentive Approaches 351EXAMPLE: INTEL AND THE PROJECT XL 352
Superfund 352 • State Policy Initiatives 353
The Political Economy of Environmental Protection 353The Nature of Environmental Politics 353 • Judicial Politics 354 • Advocacy Science 354• Distributive Politics 355 • Private and Public Politics 356EXAMPLE: THE EQUATOR PRINCIPLES 357
NIMBY and Private Politics 358
Management of Environmental Protection Issues 359EXAMPLE: DOW CHEMICAL AND LOCAL ENVIRONMENTALISTS 361 •EXAMPLE: MCDONALD'S AND WASTE REDUCTION 362
EXAMPLE: ENVIRONMENTAL ACTIVISM AT HOME DEPOT 363
Voluntary Collective Environmental Programs 364Summary 365
• X Contents
Cases 366Regulation as Opportunity: Cummins Inc. 366Emerging Nanotechnology Regulation: Samsung's SilverCare Washing Machine 368Environmental Justice and Pollution Credits Trading Systems 370
CHAPTER 12 Law and Markets 374Introduction 374The Common Law 375Property 376
Bargaining 376 • Incentives and Appropriability 377Intellectual Property 377
Intellectual Property Protection 378EXAMPLE: INTELLECTUAL PROPERTY ENFORCEMENT AND DIGITAL PIRACY 379
EXAMPLE: MICKEY MOUSE POLITICS AND LAW 381
Contracts 383EXAMPLE: GENENTECH AND CITY OF HOPE 384
Enforceability 385 • Breach 385 • Remedies 385Torts 386The Product Safety Problem and Social Efficiency 387Entitlements, Liability, and Social Efficiency 389
Entitlements and Their Protection 389 • The Assignment of Social Costs and the Choice Between Liabilityand Regulation 391
Products Liability 392The Development of Products Liability Law 392 • Allowable Defenses Under Strict Liability 395• Preemption 396 • Damages 397 • The Politics of Products Liability 398
Imperfections in the Liability System 399EXAMPLE: SILICONE BREAST IMPLANTS 401
Summary 403Cases 404
California Space Heaters, Inc. 404Patent Games: Plavix 406Obesity and McLawsuits 408
CHAPTER 13 Information Industries and Nonmarket Issues 413Introduction 413The Economics of Online Markets 414Internet Privacy 417
EXAMPLE: GOOGLE: GMAIL AND PRIVACY 419
The Internet and Tax Policy 423Online Communities 425Summary 427Cases 428
DoubleClick and Internet Privacy 428eBay and Database Protection 433eBay: Private Ordering for an Online Community 438
PART III Integrative Case: Credit Card Regulation 445
PART IV: GLOBAL NONMARKET STRATEGY 451CHAPTER 14 The Political Economy of Japan 451
Introduction 451Issues 452Interests 454
Contents xi •
Institutions 455The Diet 455 • Political Parties and the Electoral System 456 • The Bureaucracy 458• Political Reform 460
The Judicial System and the Antimonopoly Law 462Cultural Foundations 462Tying the Components Together: A Framework of Political Exchange 464
Political Exchange 464Characteristics of Business 466Business-Government Interactions 467
The Organization of Business for Nonmarket Action 467 • Nonmarket Strategies 468• Relationships with the Bureaucracy 469 • Lobbying and Points of Access 470• Information 471 • Corporate Nonmarket Styles 471
Summary 472Cases 474
The Breakup of Nippon Telephone and Telegraph? 474The Privatization of Japan Post 476Uniqlo: Success Breeds Nonmarket Challenges 479
CHAPTER 15 The Political Economy of the European Union 481Introduction 481The European Union 481
The Single European Act 482 • The Maastricht Treaty 483The Institutions of the European Union 484
The European Commission 484 • The Council of Ministers 485 • The European Parliament 486• The Court of Justice 487 • The European Economic and Social Committee 487 • The EU LegislativeProcess 488 • Economic and Monetary Union 488 • The EU ConstitutionalTreaty 490 • Competition Policy 490EXAMPLE: MICROSOFT ANI> EU COMPETITION POLICY 493
State Aids and the Common Agricultural Policy 494 • The Social Charter, Social Democracy, and LaborMarkets 494
Nonmarket Issues 496Interests and Their Organization 498Nonmarket Strategies in the European Union 499
EXAMPLE: PRONUPTIA AND FRANCHISING 504
Summary 505 •
Cases 506The European Union Carbon Tax 506The European Union Data Protection Directive 509Aldeasa and the EU Duty Free Abolition (A) 511
CHAPTER 16 China: History, Culture, and Political Economy 517Introduction 517Historical Background 518
Pre-Republican 518 • The Communist Era 520 • The Reform Era 521
Confucianism and Social Explanations 523Applications in Society, Politics, and Business 525
The Nonmarket Environment and the Four Fs 527Institutions and Government 528 • State Institutions 530 • Provincial and Local Governments 531
Business: State-Owned Enterprises, Foreign Direct Investment, and International Trade 532State-Owned Enterprises 532 • Foreign Direct Investment 533 • International Trade Policy andWTO Membership 534 • Regulation 535
Continuing Issues 535Human Rights 535EXAMPLE: AN INTELLECTUAL PROPERTY CHALLENGE 537
Energy and the Environment 539
• xi i Contents
Summary 540Cases 541
Wugang and the Reform of State-Owned Enterprises 541Direct Selling in China 543Google in China 545
CHAPTER 17 Emerging Markets 549Introduction 549
Country Assessment 549Individual Freedoms 550 • Economic Freedom 550 • Corruption 550 • Political Risk 551• Competitiveness 551 • Culture 551
Opportunities 551EXAMPLE: INDIA 552
Opportunity at the Bottom of the Pyramid? 553 • River Blindness 553 • Fair Trade 554• Microfinance 556 • Underdeveloped Markets and Business Groups 557
Risk Assessment 558Causes and Types of Risks 559
Management in the Nonmarket Environment 562Summary 563Cases 564
Tesco PLC in India? 564Social Entrepreneurship: Banco Compartamos 567Social Entrepreneurship: Kiva 568MTN Group Limited 570
CHAPTER 18 The Political Economy of International Trade Policy 574Introduction 574
The Economics of International Trade 575Competitive Theory 575 • Strategic Trade Theory 578
The Political Economy of International Trade Policy 579The Dual Nature of the Politics of International Trade 579 • Asymmetries in the Politics 580
International Trade Agreements 581The World Trade Organization 581 • General Agreement on Trade in Services (GATS) 582 • Trade-Related Aspects of Intellectual Property Rights (TRIPS) 582 • Agriculture 583 • GovernmentProcurement 584 • Antidumping, Countervailing Duties, and Safeguards 584 • Dispute Settlement 584• The Doha Round of WTO Negotiations 587 • Other Trade Agreements 588
U.S. Trade Policy 588The Structure of U.S. Trade Policy 588 • U.S. Trade Law and Its Administration 589
The Political Economy of Protectionism 590Formal Policies 590 • Channels of Protection 591EXAMPLE: STEEL IMPORTS AND THE NONMARKET CAMPAIGN 592
The Political Economy of Market Opening 594The North American Free Trade Agreement 594 • Market Opening Under the Threat of Retaliation 595
Summary 596Cases 597
Cemex and Antidumping 597Compulsory Licensing, Thailand, and Abbott Laboratories 602Sophis Networks and Encryption Export Controls (A) 607
PART IV Integrative Case: Toys 'JP Us and Globalization 614
PART V: ETHICS AND CORPORATE SOCIAL RESPONSIBILITY 619CHAPTER 19 Corporate Social Responsibility 619
Introduction 619The Trust Gap 620
Contents xi i i •
What Is Corporate Social Responsibility? 621Milton Friedman's Profit Maximization 621
Compliance with the Law 625Stakeholder Theory 626The Business Roundtable Statement on Social Responsibility 628
Discussion 629
Corporate Social Responsibility and Corporate Social Performance 630EXAMPLE: TUNA AND DOLPHINS 631
A Framework for Corporate Social Performance 632Terminology 632 • The Setting 632 • Motivations for CSP 633 • Rewards 634• Summary 635 • Empirical Research 635
Corporate Governance 637Social Accountability 637 • The Duties of Boards of Directors 638 • Sarbanes-Oxley 639• The Market for Control 640
Summary 641Cases 642
The Collapse of Enron: Governance and Responsibility 642Wal-Mart: Nonmarket Pressure and Reputation Risk (B):A New Nonmarket
Strategy 647Playing by the Rules? 650
CHAPTER 20 Ethics Systems: Utilitarianism 653Introduction 653The Managerial Role of Ethics 653What Ethics Is and Is Not 654
Personal and Business Ethics 655Ethics and Private Interests 655Ethics, Politics, and Change 655Casuistry 656
EXAMPLE: SAVING THE DIVISION 657
The Methodology of Ethics 657The Relationships Among Moral Philosophy, Ethics, and Political Philosophy 659Utilitarianism: A Consequentialist System 660
Utilitarianism and Self-interest 661 • Aligning Self-interest with Societal Well-Being 661 • Utilitarianism,Distribution, and Altruism 662 • Summary of the Components of Utilitarianism 662
Utilitarian Duty and the Calabresi and Melamed Principles 662Act and Rule Utilitarianism 664
Jointly Determined Consequences 665 • Decision Making in the Face of a Moral Transgression 666Utilitarianism and Rights 666Criticisms of Utilitarianism 667
Philosophical Criticisms 667 • Interpersonal Comparisons of Utility 668 • Identifying Costs andBenefits 668 • The Measurement Problem 668 • The Information Problem 669
Utilitarianism in Application 670Categories of Situations 670 • Methodology 670EXAMPLE: LIVING BENEFITS 671
EXAMPLE: INTEGRITY TESTS 672
EXAMPLE: LIFE INSURANCE SCREENING FOR PREEXISTING CONDITIONS 673
EXAMPLE: REDLINING 673
Summary 674Cases 675
Pricing the Norplant System 675Tax Shelters 677Pfizer and Celebrex 679
XIV Contents
CHAPTER 21 Ethics Systems: Rights and Justice 681Introduction 681Classification of Ethics Systems 681Classes of Rights 682Kantian Maxims or Moral Rules 683
EXAMPLE: LIVING BENEFITS 684
The Relationship between Maxims and Rights 684 • Intrinsic and Instrumental Rights 685• Criticisms of Kantian Rights 687EXAMPLE: PRIVACY 688
Applied Rights Analysis 689Claimed and Granted Rights 689EXAMPLE: LIFE INSURANCE SCREENING FOR PREEXISTING CONDITIONS 691
A Methodology for Rights Analysis 691
Conflicts Among Rights 691Rights and Interests 692 • Prioritization 692EXAMPLE: INTEGRITY TESTS 693
Equal Employment Opportunity 694Disabilities and Rights 696Neoclassical Liberalism 697Categories of Justice Theories 698
Distributive Justice 698 • Compensatory Justice 699 • Injustice 700Rawls 's Theory of Justice 700
The Framework for Justice as Fairness 700 • The Principles of Justice 702 • The Role ofIncentives 703EXAMPLE: LIVING BENEFITS 704
Duty in Rawls's Theory 704EXAMPLE: CLINICAL TRIAL OBLIGATIONS 705
Criticisms of Rawls's Theory 705 • Applying the Principles of Justice 706EXAMPLE: AFFIRMATIVE ACTION 707
EXAMPLE: INTEGRITY TESTS 709
EXAMPLE: REDLINING 709
EXAMPLE: LIFE INSURANCE SCREENING FOR PREEXISTING CONDITIONS 710
Higher Order Standards for Evaluating Ethics Systems 710Summary 710 rCases 712
Genetic Testing in the Workplace 712Citigroup and Subprime Lending 714Consumer Awareness or Disease Mongering? GlaxoSmithKline and the Restless Legs Syndrome 716
CHAPTER 22 Implementing Ethics Systems 720Introduction 720
EXAMPLE: LEVI STRAUSS & COMPANY AND GLOBAL SOURCING 721
Moral Determinants of Nonmarket Action 722EXAMPLE: CIRCLE K'S HEALTH CARE POLICY 723
The Challenge of Corporate Social Responsibility 724Corporate Social Responsibility and Ethics in Practice 726
EXAMPLE: UNOCAL CORPORATION AND THE DIRTY CAR BOUNTY 726
EXAMPLE: SOUTH SHORE BANK AND COMMUNITY DEVELOPMENT 727
EXAMPLE: BP AND SOCIAL RESPONSIBILITY 727
EXAMPLE: WAL-MART REPUTATION AND STAKEHOLDER MANAGEMENT 728
EXAMPLE: CITIGROUP: RESPONSIBILITY UNDER FIRE? 730
EXAMPLE: JOHNSON & JOHNSON'S "OUR CREDO" 731
Core Principles and Their Evolution 731 • The Body Shop and the Social Audit 732 • Codes ofConduct 733 • Competitive and Proprietary Information 734 • Principles and Reasoning 734
Contents XV
Tensions in the Implementation of Ethic Principles 735Paternalism 735 • Nonmarket Action and Restraint 736
Sources of Unethical Behavior 738Summary 739Cases 740
Denny's and Customer Service 740Gilead Sciences (A): The Gilead Access Program for HIV Drugs 742Advanced Technology Laboratories, Inc. 746
CHAPTER 23 Ethics Issues in International Business 749Introduction 749International Law and Institutions 750Cultural Relativism 751Human Rights and Justice 754
Slave Labor in Saipan? 754Operating in Developing Countries 755AIDS and Developing Countries 756
EXAMPLE: GLAXOSMITHKLINE AND NONMARKET SPILLOVERS 757
Responsibility for Working Conditions in Suppliers' Factories 758Sweatshops 758 • Private Governance and Self-Regulation: The Fair Labor Association 759• Company Responses 759
International Codes 761Questionable Foreign Payments and Corruption 761
Questionable Payments and Ethics Principles 762 • The Lockheed Case 763 • A Utilitarian Analysisof Bribery 764 • The Foreign Corrupt Practices Act 766 • Company Codes 767 • Cummins'sPractice 768 • The OECD Anti-Bribery Convention 769
Summary 770
Cases 772Complications in Marnera 772De Beers and Conflict Diamonds 773
. Siemens: Anatomy of Bribery 774
PART V Integrative Case: GlaxoSmithKline and AIDS Drugs Policy 778
References 784• 0
Index 796