The first and third examples make me cringe. How in the world does one measure a hedon? And how are the citizenry supposed to predict the behavior of the law? A proper government exists to define the board, not direct the pieces.
As for the second example, typically people talk about “net present value” rather than “expected profits.” They cash out similarly, but NPV explicitly includes factors like discounting and risk which expected profits generally do not do. And there it’s easy to see how opinions will clash- how much do we value intangibles like reputation? What is our risk tolerance?
Those problems highlight my point- there is no objective “net present value” that we just need to discover. There are about as many net present values as there are decision-makers, and if they aren’t coherent the corporation will be working at cross-purposes.
But how to make them cohere is a complicated problem, and I suspect that any solution that does not approach the problem in its complexity will be a vacuous solution.
The first and third examples make me cringe. How in the world does one measure a hedon? And how are the citizenry supposed to predict the behavior of the law? A proper government exists to define the board, not direct the pieces.
As for the second example, typically people talk about “net present value” rather than “expected profits.” They cash out similarly, but NPV explicitly includes factors like discounting and risk which expected profits generally do not do. And there it’s easy to see how opinions will clash- how much do we value intangibles like reputation? What is our risk tolerance?
Those problems highlight my point- there is no objective “net present value” that we just need to discover. There are about as many net present values as there are decision-makers, and if they aren’t coherent the corporation will be working at cross-purposes.
But how to make them cohere is a complicated problem, and I suspect that any solution that does not approach the problem in its complexity will be a vacuous solution.