Presentation on theme: "THE SOCIAL INSTITUTION RESPONSIBLE FOR"— Presentation transcript:
1 THE SOCIAL INSTITUTION RESPONSIBLE FOR ORGANIZING THE PRODUCTION, DISTRIBUTION,AND CONSUMPTION OF GOODS AND SERVICES111111
2 Social InstitutionA stable and widely accepted cluster of values, norms, statuses, roles and groups that develops around a basic need in society. As such, an institution is a complex phenomenon, much more complicated than the mere sum of its parts.Major Social Institutions:The economyThe political systemReligious systemsThe educational systemThe health systemThe family
3 Social Institutions Are the Environment which Influence, and Give Meaning to, the Individual
4 Social Institutions INSTITUTIONS Organized patterns of beliefs and behaviors centered on basic social needs, adapting to a specific segment of society in question--rural doctor vs. urban specialist.Functionalism:Interrelated and interdependent, resist change, integrated, promote stability. Focus: How they fulfill essential system requirements, Self-correcting;Replacing personnelTeaching new recruitsProducing and distributing goods and servicesPreserving OrderProviding and maintaining a sense of purpose
5 Social Institutions INSTITUTIONS Conflict: The outcome and functioning of institutional structures is not necessarily efficient nor desirable.Order is negotiated, but not all groups have equal footing.Organization of major institutions is built upon the interests and control of dominant groups. Preserve status quo, inhibit change by maintaining relationships of inequality in Schools, Politics, Economics. (Source of Social Problems)
6 Social Institutions Symbolic Interaction: INSTITUTIONS Workers engage in informal interactions to structure their work environment realityCommunication: formal vs. informal: a remark by corporate executive becomes viewed as an order, nurses making decisions for doctors.Real and varied negotiations over roles and status
7 Historical Review of the Economy Agricultural Revolution (roughly 5,000 years ago)Four factors gave rise to the economy as a social institutionAgricultural technology - surplus of foodSpecialized work – Artisans and tradespersons; not everyone needed to produce foodPermanent settlements- people could lead more stable livesTrade – the exchange of surpluses, or other valuables could occur between settlementsIndustrial RevolutionNew sources of energyCentralization of work in factoriesMass productionOver-specialization – artisans used to make entire product at home; now a worker only one small partWage laborPost Industrial EconomyFrom tangible products to ideasFrom mechanical skills to literacy skillsFrom factories to ……………….. anywhere
8 The Transformation of the Medium of Exchange The Medium of Exchange - the means by which people value and exchange goods and services.Mediums of exchange have progressed over time:Barter - direct exchangeMoney - places a value on items.Debit cards and E-cash - digital currency.
9 ECONOMIC EXPANSION KEY FACTORS: AGRICULTURAL TECHNOLOGY PRODUCTIVE SPECIALIZATIONPERMANENT SETTLEMENTSEXPANDED TRAVEL AND TRADEWORK WORLD BECAME SEPARATE FROM THE WORLD OF THE FAMILYCOTTAGE INDUSTRIES FLOURISHED AS PERSONS WORKED AT JOBS AND IN HOMES PRODUCING MARKET GOODS2222222
10 Preindustrial Societies The earliest human groups had a subsistence economy, living off of the land.Horticultural societies began breeding animals and cultivating plants.This allowed them to settle in one area.Agricultural societies formed after the invention of the plow, and individuals created more than what was needed for survival.This surplus led to a division of labor and social stratification; class and caste.
11 TERMINOLOGY SOCIAL STRATIFICATION SOCIAL CLASS CLIMBING SOMELADDERS IS MOREEASILY DONE THANCLIMBING THELADDER OF SOCIALSUCCESS!SOCIAL STRATIFICATIONTHE DIVISION OF SOCIETY INTO RANKED CATEGORIES OF PEOPLEEACH ENJOYING DIFFERENT LEVELS OF ACCESS TO SCARCE AND VALUED RESOURCESCHIEFLY PROPERTY, PRESTIGE, AND SOCIAL POWERSOCIAL CLASSA CATEORY OF PEOPLE WHO SHARE A COMMON POSITION IN A VERTICAL HIERARCHY OF DIFFERENTIAL SOCIAL REWARDSTRUCTURED SOCIAL STRATIFICATIONWHEN STRATIFICATION IS BUILT INTO SOCIETYAS WITH THE AMERICAN CLASS SYSTEM
12 INDUSTRIALIZATION INTRODUCED FIVE NOTABLE CHANGES TO WESTERN SOCIETIES NEW FORMS OF ENERGIESSTEAM-FUELED MACHINE OPERATIONCENTRALIZATION OF WORKIMPERSONAL FACTORIES REPLACED COTTAGE INDUSTRIESMANUFACTURING AND MASS PRODUCTIONTURNING RAW MATERIALS INTO A WIDE RANGE OF PRODUCTSSPECIALIZATIONDIVERSE DIVISION OF LABOR AND LOWER OVERALL SKILL REQUIREMENTSWAGE LABORWORKING FOR STRANGERS WITH INTENSE SUPERVISION333333
13 POSTINDUSTRIAL ECONOMY FROM THE TANGIBLE TO THE INTANGIBLE BASED ON SERVICE WORK AND HIGH-TECHFROM THE TANGIBLE TO THE INTANGIBLECREATING AND MANIPULATING SYMBOLS IN MODERN SOCIETYMECHANICAL TO LITERACY SKILLSSPEAKING, WRITING, AND COMPUTER KNOWLEDGEDECENTRALIZATION OF WORKFLEX-TIME, FAX MACHINES, “OFFICE ON THE GO”44444
14 SUCH EVOLUTION ALSO IMPACTED ECONOMIC SECTORS SECTORS OF THE ECONOMYSUCH EVOLUTION ALSO IMPACTED ECONOMIC SECTORSPRIMARY SECTORGENERATION OF RAW MATERIALS FROM THE ENVIRONMENTLOW INCOME COUNTRIES = 63% OF ECONOMYHIGH INCOME COUNTRIES = 4% OF ECONOMYSECONDARY SECTORTRANSFORMATION OF RAW MATERIALS INTO MANUFACTURED GOODSGROWTH RAPID IN ALL INDUSTRIALIZED NATIONS OR THOSE ENTERING THE PHASETERTIARY SECTORECONOMY GENERATES SERVICES RATHER THAN GOODSLOW INCOME COUNTRIES = 22% OF ECONOMYHIGH INCOME COUNTRIES = 70% OF ECONOMY55
16 Economy and SocietyEconomy – the organization of the means by which necessary and/or desired goods and services are produced and distributed among the members of a society or a group within that societyCapitalism – an economic system in which the means of production are privately owned and market forces determine production and distributionSocialism – an economic system in which the means of production are collectively owned and the state directs production and distribution
17 CAPITALISM PRIVATE OWNERSHIP OF PROPERTY PURSUIT OF PERSONAL PROFIT KEY CONCEPT OF CAPITALISMPURSUIT OF PERSONAL PROFITSIMPLY A “MATTER OF DOING BUSINESS”FREE COMPETITIONTHE “INVISIBLE HAND” IS AT WORK SO LEAVE THE MARKET ALONE5777
19 Economy and Society The Spirit of Capitalism Adam Smith – “The Wealth of Nations “ Every individual endeavors to employ his capital so that its produce may be of the greatest value. He generally neither intends to promote the public interest nor knows how much he is promoting it. He intends only his own security, only his own gain, and he is thus led by an invisible hand to promote an end which was no part of his intentions.” Which hand is it?
20 Economy and Society The Spirit of Capitalism “Rational Choice” an individual’s choice, if unfettered by external forces, will be rational, and based upon their perceptions of what is best for themselves. Adam Smith introduced this concept when arguing for capitalism. Acceptance of the rational choice model requires additional assumptions that are macro in nature, as they claim influence upon most of the social institutions which make up any society.
21 How does one make a “rational choice”? Who decides what choices we have?What is rational?How does the process occur?
22 Economy and Society The Spirit of Capitalism Capitalism rests on principles that are supported by rational choice theory. These principles include:Free-Market Competition – economic forces will guarantee the greatest good for the greatest number of people (utility) within a society, provided that the government does not compete with , or hinder, private enterprise; laissez-faire *Private Ownership – private individuals, alone or in groups, own the means of productionPursuit of Profit – the pursuit of profit will produce the greatest good for the greatest number of people because it ensures that successful risk takers earn profit, the consumer saves money, and the society becomes more efficient and vigorous* Marx asserted that un-regulated capitalism contained the forces which would be self-destructive; greed and power.
23 PURSUIT OF COLLECTIVE GOALS COLLECTIVE OWNERSHIPLIMITS THE RIGHT TO OWN PROPERTYFORM A CLASSLESS SOCIETYPURSUIT OF COLLECTIVE GOALSPURSUIT OF PROFITS STANDS AT ODDS WITH COLLECTIVE GOODGOVERNMENT CONTROL OF THE ECONOMYCENTRALLY CONTROLLED ECONOMYCONSUMERS SHOULD NOT DRIVE ECONOMY (WHY?)888
24 Economy and Society Socialism Under socialism the government plays a direct role in the economy by assuming ownership of a society’s strategic businesses, industries, and resourcesIn theory, the means of production are held in trust by the government for the benefit of all citizensAn item’s value is based upon the work that goes into it; profit is excess value withheld from the worker (Marx)Criticisms of SocialismSocialism merely replaces the forces of competition with the forces of vast bureaucracies in order to control the economySocialism leads to a lack of incentive and creativenessSocialism tends to be more resistant to adaptation and change than capitalism
25 CAPITALISM SOCIALISM ECONOMIC PRODUCTIVITY ECONOMIC EQUALITY GDP IS $13,500.00ECONOMIC EQUALITYMORE INCOME DISPARITYOVERALL WELL-BEINGA HIGH QUALITY OF LIFE, BUT GREATER DISPARITIESPERSONAL FREEDOMSARE THE HEART OF A CAPITALISTIC SYSTEM; THE NEED CREATIVE FORCESECONOMIC PRODUCTIVITYGDP IS $5,000.00ECONOMIC EQUALITYLESS INCOME DISPARITYOVERALL WELL-BEINGLOWER STANDARDS OF LIVING, BUT LESS DISPARITYPERSONAL FREEDOMSTRESS IS PLACED UPON FREEDOM FROM BASIC NEEDSMANY SOCIALIST ECONOMIES HAVE FAILED DUE TOUNDERPRODUCTION, LOW LIVING STANDARDS, LARGELYINEFFECTIVE CENTRAL GOVERNMENTS, AND OVERLYRIGID CONTROL OF INFORMATION AND PERSONAL MOVEMENT.
26 Economy and Society Unemployment and Profits Case study, last page of handoutWhat are the social costs of profit achieved by the elimination of jobs?What are the corporation’s responsibility to society for the social consequences of downsizing?How does the fact that businesses create jobs, generate income, pay taxes, and infuse the culture with new technology answer some of the above questions?How does the anxiety of job loss, either real or imagined, affect the individual worker, the social interaction between workers (competition), and the relationships between management and line employees?Are unions a means for the workers to eliminate some of the negative aspects of competitive capitalism? Are they functional, even to those who own the majority of the assets of our society?
27 The Future Trade among nations will increase greatly. Not all nations will benefit equally.Computer driven production will continue to reduce the number of workers needed.Technology also creates new jobs.Our future will consist of a divided society; a small affluent group and a larger less affluent group. (What do you think?)
30 THE WORKFORCE THE DUAL LABOR MARKET LABOR UNIONS PRIMARY LABOR MARKET EXTENSIVE BENEFITS TO WORKERSSECONDARY LABOR MARKETMINIMAL BENEFITS TO WORKERSLABOR UNIONSORGANIZED LABOR SEEKING BETTER WAGES AND BENEFITS FOR MEMBERSDECLINE OF UNIONSLOSS OF HIGHLY UNIONIZED JOBSCONCESSIONS HAVE INCLUDED DISSOLUTION OF UNIONSMANY TEMPORARY WORKERS THESE DAYS999
31 TRAITS OF PROFESSIONALS: THEORETICAL KNOWLEDGEEXTENSIVE SCHOOLINGSELF-REGULATED TRAININGPARTICIPATION IN ASSOCIATIONSAUTHORITY OVER CLIENTSFOLLOW MY SUGGESTIONSORIENTATION TO COMMUNITYNOT THE PAY, BUT THE HELPPARAPROFESSIONALSNOT ABLE TO CLAIM FULL PROFESSIONAL STATUSSELF-EMPLOYMENTEARNING A LIVING WITHOUT WORKING FOR A LARGE CORPORATIONWOMEN FIND FREEDOM AND OPPORTUNITY111111
32 Work in U.S. SocietyToday, farmers make up just over 2% of the work force.The Quiet Revolution - the many women who have joined the ranks of paid labor.The Underground Economy - activities that people do not report to the government.Teleworking - our current technology has allowed several million workers to return home.
34 TO HAVE OR NOT HAVE TECHNICAL EXPERTISE …THAT WILL BE THE QUESTION IN THE FUTURE COMPUTERS ARE:“Conflict model”“DE-SKILLING” LABORMACHINES MAKE DECISION-MAKERS OBSOLETEMAKING WORK MORE ABSTRACTUNDERSTANDING RATHER THAN “DOING”LIMITING WORKSPACE INTERACTIONISOLATES WORKERSINCREASING CONTROL OVER WORKERSELECTRONIC MONITORS151515
35 Globalization???? ECONOMIC CONCENTRATION AN ORGANIZATION WITH A LEGAL EXISTENCE, INCLUDING RIGHTS AND LIABILITIES, APART FROM THOSE OF ITS MEMBERSECONOMIC CONCENTRATIONIN 2002, WAL-MART WAS THE LARGEST$214 BILLION IN REVENUE700,000 EMPLOYEESCONGLOMERATES - SEVERAL SMALLER CORPORATIONSSTRATEGY FOR DIVERSIFYINGINTERLOCKING DIRECTORATESCOMPETITION IS A GREY AREAMONOPOLY: DOMINATION OF A MARKET BY ONE CORPORATIONOLIGOPOLY: DOMINATION OF A MARKET BY A FEW CORPORATIONSGlobalization????161616
36 Economy and Society Sociological Analysis of the Economy Functionalism Social stability is achieved by an efficient distribution of goods and services, the production of wealth and power on a large scale, and, innovation and change which obviates the necessity of a revolution.ConflictCapitalism creates an inequity of wealth and power that benefits an elite. This elite not only controls the corporate world, but also uses their resources to influence the political order for their own interests, at the expense of others.Symbolic InteractionCareer socialization can lead to multiple outcomes for the individual, and businesses and the media create role models and ideas about work and what that means to individuals. Governments also work to create loyalty to specific economic systems for both idealistic and pragmatic reasons.
37 CEO Cash and Stock-Based Compensation Changes, Layoff Decisions, and Shareholder Value (2007) Jeffrey T. Brookman University of Nevada, Las Vegas Saeyoung Chang University of Nevada, Las Vegas - Department of Finance Craig G. Rennie University of Arkansas - Sam M. Walton College of Business Financial Review, ForthcomingAbstract: The CEOs of firms announcing layoffs receive 22.8% more total pay in the subsequent year than other CEOs. These pay increases result almost entirely from increases in stock-based compensation and are found to persist. In addition, layoff announcements are accompanied by shareholder value increases averaging $40 million to $95 million. One-time labor cost savings from layoffs average $65 million. We conclude CEOs receive pay increases following layoffs as rewards for past decisions and to motivate value-enhancing decisions in the future.Keywords: Corporate Governance, Compensation, LayoffsJEL Classifications: G34, J33, J63Accepted Paper Series