UNIVERSITYOFCALIFORNIACourseOutline

HaasSchoolofBusiness Fall2004

BA107:
THESOCIALANDPOLITICALENVIRONMENTOFBUSINESS
ProfessorMichaelGerlach
email:gerlach@haas.berkeley.edu
Telephone:6423676
Officehours:Wednesday,1012
Officelocation:HaasF599

Thiscoursefocusesonthenonmarketenvironmentofbusiness,and
thewaysthatmanagerscanshapethisenvironmenttotheir
corporation'sstrategicadvantage.Thisenvironmentincludesthe
variouspolitical,legal,social,andhistoricalforcesthat
providethe"rulesofthegame"underwhichcompanies,
industries,andnationaleconomiesoperate.
Webeginwithanoverviewofthenonmarketenvironmentinthe
U.S.,consideringbothhistoricalandcontemporaryforcesthat
haveshapedthemoderncorporationanditsstrategies.Wethen
considerthepoliticalenvironmentofbusinessinmoredetail,
addressingissuessuchasregulationandderegulation,antitrust
policy,andhightechnologypolicy,aswellasevaluating
strategiesfordealingwiththisenvironment.(The2004national
electionwillprovideausefulbackdropforthisanalysis.)
Wealsoconsidertheroleplayedbycorporatesocial
responsibility,corporategovernance,andbusinessethicsinthe
businessworld.Finally,weconsidertheincreasingly
controversialissueof"globalization"byevaluatingthesocial
andpoliticalroleplayedbymultinationalenterprises(MNEs)in
hostcountriesandinthe"outsourcing"ofdomesticjobsto
overseasworkers.

CourseMaterials
Coursematerialsincludethefollowing:
(1)Coursereadersforthefirstandsecondhalfofthecourse
(availableatCopyCentralonBancroft).
(2)Inclasshandouts.Forthoseunabletoattendlecture,these
handoutswillbeavailableoutsidemyoffice(F599)forone
weekaftertheassigneddate.Selectedportionswillalso
bepostedonthecoursewebsite.
(3)Inclassvideotapes.Theseareintendedtocomplementother
coursematerials,buttheircontentswillnotbeincludedon
exams.

Enteringthecourse
A.ConsistentwiththeproceduresoftheHaasUndergraduate
Program,allstudentsmustgainadmittancetothecoursethrough
theHaasUndergraduateOffice.TheinstructorandGSIhaveno
controloverthisprocess.
B.Attendanceinyourassignedsectioninthefirsttwoweeksof
thecourseisessentialtoremaininginthecourse.Students
absentinthefirsttwoweekswillbedroppedfromclasslists.

COURSEREQUIREMENTS
BA107hasfourcourserequirements:
(1)
(2)
(3)
(4)

Midtermexamination:20%
Finalexamination:30%
Twoshortcasewriteups(20%each):40%
Attendanceandparticipationinsections:10%

Midtermandfinalexams.Thecourseexamswillbeclosedbook
andwillincludematerialscoveredinbothlectureandsection.
Questionswillbesimilartothosereviewedinweeklysection,
withanemphasisonintegratingmaterialsinthoughtfulways.

Thefinalexamwillbecumulative,althoughgreateremphasiswill
beplacedonmaterialscoveredinthesecondhalfofthecourse.
Caseanalyses.Studentswillberequiredtoturninshortcase
analysestwiceduringthesemester.Thesewriteupsshouldbeno
morethanfour(4)doublespacedpagesinlength,andaredueat
thebeginningofsectioninweek6andweek14.Additional
detailswillbeprovidedinclass.
Sectionattendanceandparticipation.Sectionsareanintegral
partofthiscourse,andstudentsareexpectedtoattendtheir
assignedsectiononaregularbasis.(Sectionchangesare
allowedonlyunderexceptionalcircumstancesandonaspace
availablebasis.)Studentsareallowedtomissamaximumoftwo
sectionswithoutpriornotificationoftheGraduateStudent
Instructor.Absencesabovethisnumberwillleadtoafailing
gradeforthisportionofthecourse,whilecompletionofthis
basicattendancerequirementwillresultinagradeforthis
portionofnolessthana"B".Gradesabovea"B"willrequire
atleastsomedegreeofactiveparticipationinthediscussion,
withqualitycountingformorethanquantity.

WEEKLYITINERARY

PARTONE:INTRODUCTION

[8/30]WEEK1.COURSEOVERVIEW

A.Lecturereadings.Introduction.
[noreadings]

B.Sectionreadings.Gettingacquaintedandcourseoverview.

[9/6]WEEK2.THENONMARKETENVIRONMENTOFBUSINESS

A.Lecturereadings.[NolectureLaborDayholiday]
[noreadings]

B.Sectionreadings.Discussiontopic:thenonmarketenvironment
andintegratedstrategy.
"MarketandNonmarketEnvironments."FromDavidP.Baron,
BusinessandItsEnvironment,chapter1.
"IntegratedStrategy."FromDavidP.Baron,BusinessandIts
Environment,chapter2.

[9/13]WEEK3.THERISEOFBIGBUSINESSANDBIGGOVERNMENT

A.Lecturereadings.
"Theoriginsofbigbusiness."FromHeidiVernonWortzel
BusinessandSociety,5thedition,Irwin.
"Thecurseofbigness:America'sregulatorycapitalism."From
YerginandStanislaw,TheCommandingHeights,chapter2.

B.Sectionreadings.Discussiontopic:implicationsforbusiness
oftheincreasingsizeofbusinessandgovernment.
[noreadings]

[9/20]WEEK4.POLITICALTHEORYANDINSTITUTIONS

A.Lecturereadings.
"PoliticalTheoryandGovernmentInstitutions."FromDavidP.
Baron,BusinessandItsEnvironment,chapter5.
"Thedelayedrevolution:America'snewbalance."FromYerginand
Stanislaw,TheCommandingHeights,chapter12.
"Circlingthewagons."NYT,6/5/04.
"StylessimilarinBushandKerryduelondeficitnumbers."NYT,
8/15/04.

B.Sectionreadings.Discussiontopic:implicationsofthe
nationalelectionforbusiness.
PartyplatformsfortheDemocraticandRepublicanparties[tobe
providedlater]

PARTTWO:THEPOLITICALENVIRONMENTOFBUSINESS

[9/27]WEEK5.CORPORATEPOLITICALSTRATEGIES

A.Lecturereadings.
"ImplementingPoliticalStrategies."FromDavidP.Baron,
BusinessandItsEnvironment,chapter8.
"Forcorporatedonors,therestraintsareoff."NYT,7/25/04.
"BusinessesplanattackonEdwards."NYT,8/24/04.

B.Sectionreadings.Discussiontopic:Enron'spolitical
strategies.
"LettersshowBushandLaysharedmuch."NYT,2/16/02.
"Enron,preachingderegulation,workedthestatehousecircuit."
NYT,2/9/02.
"Influencelost,exEnronchieffacesCongress."NYT,2/3/02.

[10/4]WEEK6.REGULATIONANDDEREGULATION

A.Lecturereadings.
"Regulation:Law,Economics,andPolitics."FromDavidP.Baron,
BusinessandItsEnvironment,chapter10.
"Outofspotlight,BushoverhaulsUSregulations."NYT,8/14/04.

"Exxonbacksgroupsthatquestionglobalwarming."NYT,5/28/04.

B.Sectionreadings.Discussiontopic:thepoliticsof
environmentalregulation.
[readingsTBA]

NOTE:CASEWRITEUP#1ISDUE[atbeginningofsection]

[10/11]WEEK7.ANTITRUSTANDINTELLECTUALPROPERTY

A.Lecturereadings.
"Antitrust:Economics,Law,andPolitics."FromDavidP.Baron,
BusinessandItsEnvironment,chapter11.
"Untanglingeconomics."SpecialsurveyontheNewEconomyin
TheEconomist,9/23/00.

B.Sectionreadings.Discussiontopic:intellectualpropertyand
digitalmusicexchange.
"Downloadwarning101."SFChronicle,8/11/03.
"Berkeley,RealNetworksdealtocurbillegalmusicdownloads."
TheDailyCalifornian,8/23/04.
"Filesharingsitesfoundnotliableforinfringement."NYT,
8/20/04.

[10/18]WEEK8.INDUSTRIALANDTECHNOLOGYPOLICY

A.Lecturereadings.
"TheglobalcontextforUStechnologypolicy."GrahamMitchell,
USDepartmentofCommerce.
"Thetechlobby,callingagain."NYT,7/25/04.

B.Sectionreadings.Discussiontopic:Midtermreview.
[noreadings]

[10/25]WEEK9.MIDTERMEXAM

A.Lecturereadings.Midtermexam.
[noreadings]

B.Sectionreadings.[nosection]
[noreadings]

PARTTHREE:CORPORATESOCIALRESPONSIBILITYANDBUSINESSETHICS

[11/1]WEEK10.CORPORATESOCIALRESPONSIBILITYANDGOVERNANCE

A.Lecturereadings.
"CorporateSocialResponsibility."FromDavidP.Baron,Business
andItsEnvironment,chapter18.
"Thenewaccountability:Trackingthesocialcosts."NYT,
3/24/02.
"Isadogoodercompanyagoodthing?"NYT,5/2/04.
"Excerptsfrom'owners'smanual'includedwithoffering."NYT,
4/30/04.

B.Sectionreadings.Discussiontopic:corporategovernanceand
theWorldComscandal.
"Designedbycommittee."TheEconomist,6/15/02.
"Amatterofchoice."TheEconomist,12/22/01.
"EbbersandpassivedirectorsblamedforWorldComwoes."NYT,
6/10/03.Twoarticles:
"Boardthatmadedecisionsinhastewithnoquestioning."NYT,
6/10/03.
"WorldCom'spracticesenabledhugefraud,2investigationsfind."
NYT,6/10/03.

[11/8]WEEK11.

A.Lecturereadings.[Noclassinstructorisoutoftown]
[noreadings]

B.Sectionreadings.Discussiontopic:reviewoftherecent
election.
[noreadings]

[11/15]WEEK12.BUSINESSETHICS#1

A.Lecturereadings.
"EthicsSystems:Utilitarianism."FromDavidP.Baron,Business
andItsEnvironment,chapter19.
"EthicsSystems:RightsandJustice."FromDavidP.Baron,
BusinessandItsEnvironment,chapter19.
"Bootcampsonethicsask'whatifs?'"NYT,1/5/03.
"Ethicslackinginbusinessschoolcurriculum,studentssayin
survey."NYT,5/20/03.

B.Sectionreadings.Discussiontopic:ethicalbehaviorandthe
McWanecorporation.
"Afamily'sfortune."NYT,1/9/03.

[11/22]WEEK13.BUSINESSETHICS#2

A.Lecturereadings.
"ImplementingEthicsSystems."FromDavidP.Baron,Businessand
ItsEnvironment,chapter20.
"EthicsIssuesinInternationalBusiness.FromDavidP.Baron,
BusinessandItsEnvironment,chapter22.

B.Sectionreadings.[NosectionThanksgivingholiday]
[noreadings]

PARTFOUR:BROADENINGTHECOURSESCOPE

[11/29]WEEK14.INTERNATIONALISSUES

A.Lecturereadings.
"Theageofglobalization:Thebattlefortheworldeconomy."
FromYerginandStanislaw,TheCommandingHeights,chapter13.

B.Sectionreadings.Discussiontopic:globalizationandthe
nonmarketenvironmentofbusiness.
"Highskillworkisnotimmunetooutsourcing,contractsshow."
NYT,6/16/04.
"Financialfirmshastentheirmovetooutsourcing."NYT,
8/18/04.

NOTE:CASEWRITEUP#2ISDUE[atbeginningofsection]

[12/6]WEEK15.FUTUREDIRECTIONSANDCOURSEREVIEW

A.Lecturereadings.
"Thebalanceofconfidence:theworldafterreform."FromYergin
andStanislaw,TheCommandingHeights,chapter14.

B.Sectionreadings.Coursereview.
[noreadings]