If the price is right, do values matter? — Chris MacDonald

Price and quality, not values

 
(Photo: Thomas Kokta/Getty)
(Photo: Thomas Kokta/Getty)

Should it matter to consumers whether the company’s CEO supports gay marriage, is a libertarian, or a Catholic, or backs a particular political party?

We discussed this yesterday (Oct. 8) as part of my Business Ethics Speakers Series at the Ted Rogers School of Management. There, I had the honour of hosting Professor Alexei Marcoux from the Quinlan School of Business at Loyola University Chicago, who gave a talk titled, “Adventures in the Market for Values.”

Alexei’s argument is that it’s almost always a mistake to let the values held by a buyer or seller get in the way of a mutually-beneficial exchange.

His point is that we should instead focus on what kinds of people we need to be in order to have a flourishing commercial society. The short answer is that we need to be tolerant folks, able to engage each other in commerce when we have a shared interest in doing so. This means that we should make our buying decisions based on price, quality, and what we know about the basic ‘commercial integrity’ (i.e., trustworthiness) of the person or company with whom we’re dealing.

But why not care about the other person’s (or company’s) values? The problem with this, he argues, is that for any given individual, commerce based on values is going to be irrational, leading to the purchase of goods that are less satisfying of our needs than available alternatives. If the deal is a good one, you should take it. (Charles Barkley exemplified this attitude when he was quoted as saying, “I can be bought. If they paid me enough, I’d work for the Klan.”) Socially, too great a focus on the other person’s values in the aggregate  results in what economists call “dead weight loss“—a loss in efficiency in the market overall.

Now two caveats apply here.

First, Alexei’s argument isn’t that we shouldn’t care about the values embodied in the products we buy. In fact, quite the opposite: he argues that we absolutely should want to make sure that the products we buy match our own values. That’s part of what is summed up in the useful but dreadfully vague word, “quality.” What counts as high-quality paper will differ from person to person, depending on the values they hold. One person demands crisp, bright white paper. Another insists on “good enough” paper that is high in recycled content. His point is that you shouldn’t care about the values of the person you buy from.

Second, his argument isn’t that it could never be right to make a purchasing decision based on the values of the person you’re dealing with. We might be able to imagine extreme cases where doing so would be reasonable. (My own candidates include situations in which the person is the product, or when the values of the person lead you to have doubts about, for example, the integrity of a brand and the cluster of values the brand is supposed to represent.)

Alexei’s point is that we shouldn’t make a habit of making decisions that way; that’s not the sort of people—the sort of community—we should want to be.

Chris MacDonald is Director of the Jim Pattison Ethical Leadership Education & Research Program at the Ted Rogers School of Management.


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