Ethical theories and their applications

Business

As defined by the utilitarian John Stuart Mill, utilitarianism has two kinds: rule-utilitarianism and act-utilitarianism. Working under the principle that "Actions are right in proportion as they tend to promote happiness; wrong as they tend to produce the reverse of happiness," Mill distinguishes between each kind of utilitarianism. In the first kind, rule-utilitarianism, an individual's actions are rationally-thought of, wherein the result or outcome of such action is morally accepted by society, and results to happiness -- that is, the "right kind" of happiness. Act-utilitarianism, meanwhile, are actions and behavior made due to the individual's need to accomplish this action -- primarily to bring immediate happiness to herself or himself. What differentiates act- from rule-utilitarianism is that the former's actions are not results of rational thought, and are generally considered immoral or unethical by the society.

The "declining marginal utility of money" is an economic concept that explains the difference between the wealthy and the poor, primarily because this concept explains how one loses almost nothing, while the other loses so much and how money becomes valuable, depending on the economic or financial capability of the individual. This concept posits that "the value to an individual of a constant sum of money gained or lost is inversely proportional to that individual's wealth." This means that a rich individual who loses amount X may consider this loss as trivial, while a working individual who loses the same amount X would consider this loss as more than just trivial, but affects his/her economic state/financial capability. In the same manner, a gain of amount Y by the working individual could already be considered as wealth for him/her, while a gain of similar amount to a wealthy individual can be just an addition to his/her daily income -- that is, a trivial addition to his/her wealth.

Robert Nozick's Entitlement Theory asserts that free market exchanges are manifestations of society's respect for people as equal -- an economic phenomenon that is given a moral dimension/explanation. This theory is hinged on three principles: transfer principle, acquisition principle, and rectification principle. The first principle holds the argument that all holdings or properties freely acquired from others are considered justly acquired. In the same vein of argument, the second principle posits that people are entitled to have holdings/properties, so long as they are acquired in a just manner. Lastly, an "injustice" committed can be rectified by giving the property back to its rightful owner (i.e., a property unjustly acquired can be corrected by returning it back to the original owner/first owner).