Archivi tag: accounting

Is it possible to quantify, using economic variables, what is in principle not subject to economic evaluation? A recent Harvard research seems to have achieved such an ambitious goal, but this inevitably makes ethical issues arise.


In the last few years, an increasing concern has developed with regard to the externalities of firms. An externality is the cost or benefit implied by an economic activity that affects a third party who did not choose to incur that cost or benefit and without this being reflected in market prices. They are one of the main justifications for public intervention in the economic sphere. On one hand, governments should reduce negative externalities through mindful regulation. On the other, they should incentivize positive externalities, which usually are not the firms’ most pressing priorities, since they do not directly result in any monetary advantage.

The profitability of a company stays unaltered both if the air of our neighborhood becomes unbreathable due to industrial waste and if we enjoy the benefits of gentrification brought about by a successful commercial activity. Can businesses, in principle, be ethical? If so, how to apply analytical tools to ethics and to subsume what is qualitative par excellence under the scope of the queen of  social sciences, namely economics? The former is a philosophical interrogation, the latter a methodological one. The consequence is that they are respectively dealt with by two different research approaches, which urge us to find a common synthesis in order to successfully coordinate and inspire our practical response. [Read More]