Urging a return to a laissez-faire worldwide economy with minimal government regulation,
Milton Friedman argues against the concept of social responsibility as a function of business.
A business person who acts “responsibly” by cutting the price of the firm’s product to aid the
poor, or by making expenditures to reduce pollution, or by hiring the hard-core unemployed,
according to Friedman, is spending the shareholder’s money for a general social interest. Even
if the businessperson has shareholder permission or encouragement to do so, he or she is still
acting from motives other than economic and may, in the long run, harm the very society the
firm is trying to help. By taking on the burden of these social costs, the business becomes less
efficient—either prices go up to pay for the increased costs or investment in new activities
and research is postponed. These results negatively affect—perhaps fatally—the long-term