Seldom has an individual been able to create more that a complex corporatist organization could. Firms are vital for creating synergies that boost innovation and progress. In the process of innovation and production companies focus on the consumer. Consumer’s tastes and preferences are the main driving or shaping force for the firms’ innovating efforts.
In the process of innovation and production, however, companies generate negative externalities. Pollution of the natural environment is a major concern today. Firms do not intrinsically seek to pollute. They do not directly benefit from it. Pollution is a side effect in the race to better fulfill consumers’ needs.But when the firms will see the natural environment as one potential customer, an important one, the negative externalities will be alleviated through the simple mechanism of competition.
Tuesday, October 2, 2007
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