Regulatory Entrepreneurship, Fair Competition, and Obeying the Law

Some sharing economy firms have adopted a strategy of “regulatory entrepreneurship,” openly violating regulations with the aim of rendering them dead letters. This article argues that in a democracy, regulatory entrepreneurship is a presumptively unethical business strategy. In all but the most corr...

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Bibliographic Details
Published in:Journal of business ethics 2022-11, Vol.181 (1), p.249-261
Main Author: Hughes, Robert C.
Format: Article
Language:English
Subjects:
Business
Business and Management
Business Ethics
Companies
Competition
Constituents
Democracy
Education
Entrepreneurship
Ethics
Injustice
Law
Management
Obligations
Original Paper
Owners
Philosophy
Property law
Property rights
Quality of Life Research
Regulation
Rentals
Resource allocation
Sharing economy
Taxation
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Summary:Some sharing economy firms have adopted a strategy of “regulatory entrepreneurship,” openly violating regulations with the aim of rendering them dead letters. This article argues that in a democracy, regulatory entrepreneurship is a presumptively unethical business strategy. In all but the most corrupt political environments, businesses that seek to change their regulatory environment should do so through the democratic political process, and they should do so without using illegal business practices to build a political constituency. To show this, the article defends a qualified moral obligation for businesspeople to obey the law even in societies that fall short of ideal democracy and that are rife with economic injustice. Owners and managers of successful businesses have strong moral reasons to obey laws concerning resource allocation. Such laws include not only property law, but also tax laws, environmental regulations, and other laws that regulate businesses in competitive markets. The moral reasons to obey such laws apply even to laws that business leaders think unfair or inefficient, provided that the laws in question have reasonable, good faith defenders.
ISSN:0167-4544
1573-0697
DOI:10.1007/s10551-021-04932-y