Expansion at Volkswagen: Minimizing Risk in E.U.?

It is perhaps common among gigantic corporations, such as the major automobile manufacturers, to assume that current profitability is likely to be augmented by expansion. Economies of scale are presumed to outpace diseconomies as even a large company expands. At a more basic level, it is generally assumed that if a company is not expanding, it is necessarily facing its downfall. The notions of equilibrium and steady state are fundamentally at odds with the more, more, more mantra of mammon. Accordingly, it can be asked whether efforts to strengthen a company’s equilibrium are more in line with long-term profitability. The very expression, strengthening an equilibrium is étranger or foreign to business parlance.


The full essay is at "Volkswagen in 2012: Minimizing Risk in the E.U."

Hollywood Bribes China

The Foreign Corrupt Practices Act, known as F.C.P.A., “forbids American companies from making illegal payments to government officials or others to ease the way for operations in foreign countries.”[1] The practical difficulty facing American companies doing business around the world is that in some cultures bribes are so ubiquitous they are simply a part of doing business.  For American companies to refuse to participate in what is generally expected can be a competitive disadvantage, particularly if substitutes exist and the practice is widespread.

The full essay is in Cases of Unethical Business: A Malignant Mentality of Mendacity, available in print and as an ebook at Amazon.

1. Edward Wyatt, Michael Cieply, and Brooks Barnes, “S.E.C. Asks if Hollywood Paid Bribes in China,” The New York Times, April 25, 2012.

European Banks Ignoring the E.U.

As banks based in the empire-scale E.U.'s state of the United Kingdom decided to pull back their operations around the world in mid 2011, the bankers may have overlooked key distinctions between their banks’ operations within the E.U. and internationally. Besides ignoring the converging impact of E.U. financial regulation within the E.U., the bankers were discounting the proposal of European Central Bank President Jean-Claude Trichet for a European rating agency. The proposal implies that certain advantages can be had for the E.U. as a whole—benefits that Lloyds, for example, implicitly discounted to the extent that the bank treated pulling back in the states of Ireland, the Netherlands, and Spain similar to pulling back in Dubai, which is not an E.U. state.

The full essay is at "Essays on the E.U. Political Economy," available at Amazon.