The Profit Paradox: Inseparability of Maximization and Prioritization in Corporate Strategy

Ceyhun Elgin ()
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Ceyhun Elgin: Boǧaziçi üniversitesi = Boğaziçi University [Istanbul]

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Abstract: This paper challenges the notion that businesses can maximize profits without making profit their top priority, arguing that profit maximization inherently requires profit prioritization. Through a comprehensive analysis of theoretical foundations, empirical case studies, and potential counterarguments, the study establishes the inseparability of profit maximization and prioritization. The paper concludes that profit maximization logically and practically necessitates profit prioritization, supported by theoretical economic models and empirical evidence from corporate behavior across various industries. This research offers a novel perspective on the relationship between profit maximization and prioritization, providing a deeper understanding of corporate decision-making and challenging prevailing notions of balanced stakeholder approaches. While the study primarily focuses on for-profit corporations in market economies, potentially limiting its applicability to other organizational forms or economic systems, it has significant practical and social implications. The findings suggest a need for greater transparency in corporate governance regarding the trade-offs inherent in profit maximization and more effective regulatory approaches that acknowledge the reality of profit prioritization. This research contributes to ongoing dialogues about the role of business in society, highlighting the tensions between profit-seeking behavior and other societal objectives.

Keywords: Profit maximization Corporate ethics Stakeholder theory; Profit maximization; Corporate ethics; Stakeholder theory (search for similar items in EconPapers)
Date: 2025-02-10
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