For solving the case of the tragedy of the commons, the proposition of Friedman, the business of business is to increase its profits, is not supportive I believe. Because when businesses exploiting resources without clearly defined property rights, and businesses trying to achieve profit maximization resulting from the increase of production and capacity combined with spread out fixed costs, the possibility for overexploitation increases.
In the case of Nha Trang Beach, if too many tourists visit the area of the coral, it may result in the earlier mentioned deterioration of the reef. Resulting in a situation that is not Social Responsible because the profit gained is not sustainable business.
In the case of Nha Trang Beach, if too many tourists visit the area of the coral, it may result in the earlier mentioned deterioration of the reef. Resulting in a situation that is not Social Responsible because the profit gained is not sustainable business.
I totally agree with you. Friedman proposition is not supportive at all in this case. Even if, as you explained before, the government has to improve its regulation and its control about the coral area, private companies have to consider their "social responsibilities" as well.
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