January 6, 2009

News & Opinion: Two Discussions Worth Having

By: 800-CEO-READ @ 7:07 PM – Filed under: Management & Workplace Culture

The New York Times economics blog, Economix, has had two great posts recently that tie into recent business books and big ideas.
The first, Helping People Make Good Choices, was posted on Sunday by economics editor Catherine Rampell and discusses "libertarian paternalism," an idea at the center of Richard Thaler and Cass Sustein's Nudge. It covers irrational behavior (the bane of traditional economists) and the subtle ways in which we can influence people to act in their own and others' best interests. The post looks at recent papers published on the topic. (Harvard is releasing a book later this month entitled Free Market Madness that discusses this very topic. We'll have more on that book soon.)
Today's post from Harvard economist Edward L. Glaeser, Can Businesses Do Well and Do Good?, discusses whether businesses can be profitable both financially and socially. It references the recently released Creative Capital, which itself chronicles a debate on the issue by over 40 contributors, and is edited by TIME Magazine columnist Michael Kinsley. Glaeser asks:
The question of creative capitalism is whether there is some role for institutions that fall between traditional profit-making and nonprofit firms. Is the world being well served with these two clearly distinguished types of entities, one of which serves only shareholders and the other of which has some other goal? Does it make sense to consider hybrid organizations that have an obligation to earn financial returns, for some of their investors, and social returns for others?

I would like to humbly offer up Muhammad Yunus (winner of the Nobel Peace Prize) and his Creating a World Without Poverty--which discusses social businesses, and was a runner-up in our New Perspectives category this year)--as a possible answer to that question.