Abstract
Mutually beneficial exchanges in markets can be exploitative because one party takes advantage of an underlying injustice. For instance, employers of sweatshop workers are often accused of exploiting the desperate conditions of their employees, although the latter accept the terms of their employment voluntarily. A weakness of this account of exploitation is its tendency for over-inclusiveness. Certainly, given the prevalence of global and domestic socioeconomic inequalities, not all exchanges that take place against background injustices should be considered exploitative. This paper offers a framework to identify exploitation in mutually beneficial exchange, focusing on the case of sweatshop labor. It argues that an employer can be viewed as taking unfair advantage of an underlying injustice if and only if the employer’s surplus from the exchange in the unjust state of affairs exceeds the surplus it could maximally obtain in a just state of affairs. The paper illustrates the applicability of this framework using three different conceptions of justice and argues that it is superior to microlevel accounts of exploitation that regard background justice as irrelevant. The paper concludes by describing some normative implications that follow from judging an exchange exploitative.
Similar content being viewed by others
Notes
Definitions of the term “sweatshop” vary, but typically include low wages and some violation of labor standards—see Zwolinski (2007, p. 715) and Zwolinski (2012, pp. 161, 162) for more detail. Other examples of potential exploitation in business include exploitation of customers, e.g., through price gouging (Snyder 2009) or payday loans (Mayer 2003), and exploitation of suppliers by powerful buyers (Schleper et al. 2017). Snyder (2010) offers an excellent survey of theoretical accounts of exploitation in business.
For the purpose of this paper, an “exchange” will be defined as a transaction between a buyer (the employer) and a seller (the worker) in a market. The price (wage) at which the exchange occurs, although treated as a single-dimensional variable for the sake of exposition, should be thought of as incorporating all dimensions of the exchange relevant to the buyer and the seller, including the monetary transfer from the buyer to the seller, but also safety standards and other working conditions. The proposed framework focuses on bilateral exchanges between a single seller and single buyer, where exploitation identifies a moral defect in the exchange between the exploiter and the exploited. It sets aside situations in which the payments made to different sellers are inter-dependent, e.g., because a factory relies on slave labor to stay in business and be able to pay fair wages to its regular workers. I am grateful to an anonymous reviewer for raising the latter point.
See also Kim (2016), who applies different theories of exploitation to the issue of “gamification” in the workplace.
See Powell (2014) for a comprehensive defense that discusses a wide range of relevant issues.
If justice leads to a more educated labor force, the new labor market equilibrium will feature different job assignments, e.g., someone who performed a manual job, such as sewing, may perform an office job instead. In such a new equilibrium, firms will invest in more physical capital and adopt less labor-intensive production technologies, which will further increase average labor productivity.
These costs are lower for workers in third world countries than in the USA since the former have lower incomes and lower life expectancy than the latter. Incomes are relevant for determining the costs of health hazards as long as willingness to pay is the appropriate measure of welfare effects, which is far from uncontroversial. However, besides budget size, the costs of health hazards are affected by lower life expectancy as well. For instance, the health impact of workplace pollution is less devastating in third world countries where life expectancy is much lower anyway. To put it bluntly, people do not live long enough to suffer some of the harmful effects of workplace pollution.
This is not to suggest that, for egalitarians, any difference in life expectancy is necessarily unjust. Nonetheless, inequalities in life prospects would be significantly reduced in a world that meets egalitarian standards of justice (Daniels 2008).
Competitive markets are characterized, among other features, by large numbers of buyers and sellers, none of which can possibly have an influence on the market price. Market actors in competitive markets are price takers.
References
Arneson, R. (1989). Equality and equal opportunity for welfare. Philosophical Studies, 56(1), 77–93.
Arnold, D. G. (2003). Exploitation and the sweatshop quandary. Business Ethics Quarterly, 13(2), 243–256.
Arnold, D. G., & Bowie, N. E. (2003). Sweatshops and the respect for persons. Business Ethics Quarterly, 13(2), 221–242.
Arnold, D. G., & Bowie, N. E. (2007). Respect for workers in the global supply chains: Advancing the debate over sweatshops. Business Ethics Quarterly, 17(1), 135–145.
Arnold, D. G., & Hartman, L. (2005). Beyond sweatshops: Positive deviancy and global labor practices. Business Ethics: A European Review, 14(3), 206–222.
Arnold, D. G., & Hartman, L. (2006). Worker rights and low wage industrialization. Human Rights Quarterly, 28(3), 676–700.
Blanc, S. (2016). Are Rawlsian considerations of corporate governance illiberal? A reply to singer. Business Ethics Quarterly, 26(3), 407–421.
Broome, J. (1991). Fairness. Proceedings of the Aristotelian Society, 91(1), 87–102.
Caney, S. (2005). Justice beyond borders. Oxford: Oxford University Press.
Clark, J. R., & Powell, B. (2013). Sweatshop working conditions and employee welfare: Say it ain’t sew. Comparative Economic Studies, 55(2), 343–357.
Coakley, M., & Kates, M. (2013). The ethical and economic case for sweatshop regulation. Journal of Business Ethics, 117(3), 553–558.
Cohen, G. A. (1989). On the currency of egalitarian justice. Ethics, 99(4), 906–944.
Cohen, J., & Sabel, C. (2006). Extra rempublicam nulla justitia? Philosophy & Public Affairs, 34(2), 147–175.
Crane, A. (2013). Modern slavery as a management practice: Exploring the conditions and capabilities for human exploitation. Academy of Management Review, 38(1), 49–69.
Daniels, N. (2008). Just health. Cambridge: Cambridge University Press.
Dworkin, R. M. (2000). Sovereign virtue. Cambridge, MA: Harvard University Press.
Goodin, R. (1987). Exploiting a situation and exploiting a person. In A. Reeve (Ed.), Modern theories of exploitation (pp. 166–200). London: Sage.
Harrison, A., & Scorse, J. (2010). Multinationals and anti-sweatshop activism. American Economic Review, 100(1), 247–273.
Kates, M. (2015). The ethics of sweatshops and the limits of choice. Business Ethics Quarterly, 25(2), 191–212.
Kim, T. W. (2016). Gamification of labor and the charge of exploitation. Journal of Business Ethics. doi:10.1007/s10551-016-3304-6
Maitland, I. (1997). The great non-debate over international sweatshops. British Academy of Management Annual Conference Proceedings, 1997, 240–265.
Mayer, R. (2003). Payday loans and exploitation. Public Affairs Quarterly, 17(3), 197–217.
Mayer, R. (2007a). Sweatshops, exploitation, and moral responsibility. Journal of Social Philosophy, 38(4), 605–619.
Mayer, R. (2007b). What’s wrong with exploitation? Journal of Applied Philosophy, 24(2), 137–150.
Meyers, C. (2004). Wrongful beneficence: Exploitation and third world sweatshops. Journal of Social Philosophy, 35(3), 319–333.
Meyers, C. (2007). Moral duty, individual responsibility, and sweatshop exploitation. Journal of Social Philosophy, 38(4), 620–626.
Miklós, A. (2011). The basic structure and the principles of justice. Utilitas, 23(2), 161–182.
Miller, D. (2007). National responsibility and global justice. Oxford: Oxford University Press.
Moellendorf, D. (2002). Cosmopolitan justice. Boulder, CO: Westview Press.
Nagel, T. (2005). The problem of global justice. Philosophy & Public Affairs, 33(2), 113–147.
Nussbaum, M. (2000). Women and human development: the capabilities approach. Cambridge: Cambridge University Press.
Pearce, F. (2012). The land grabbers. Boston, MA: Beacon Press.
Pogge, T. W. (2000). On the site of distributive justice: Reflections on cohen and murphy. Philosophy & Public Affairs, 29(2), 139–169.
Pogge, T. W. (2002). World poverty and human rights. Cambridge: Polity Press.
Powell, B. (2014). Out of poverty: Sweatshops in the global economy. Cambridge: Cambridge University Press.
Powell, B. (Forthcoming). Sweatshop regulations: Tradeoffs and welfare judgements. Journal of Business Ethics.
Powell, B., & Skarbek, D. (2006). Sweatshops and third world living standards: Are the jobs worth the sweat? Journal of Labor Research, 27(2), 263–274.
Powell, B., & Zwolinski, M. (2012). The ethical and economic case against sweatshop labor: A critical assessment. Journal of Business Ethics, 107(4), 449–472.
Preiss, J. (2014). Global labor justice and the limits of economic analysis. Business Ethics Quarterly, 24(1), 55–83.
Rawls, J. (1999). A theory of justice (Rev ed.). Oxford: Oxford University Press.
Risse, M. (2012). On global justice. Princeton, NJ: Princeton University Press.
Roemer, J. (1988). Free to lose. Cambridge: Cambridge University Press.
Roemer, J. (1998). Equality of opportunity. Cambridge, MA: Harvard University Press.
Sample, R. J. (2003). Exploitation: What it is and why it’s wrong. Lanham, MD: Rowman & Littlefield.
Sangiovanni, A. (2007). Global justice, reciprocity, and the state. Philosophy & Public Affairs, 35(1), 3–39.
Scheffler, S. (1982). The rejection of consequentialism. Oxford: Oxford University Press.
Schleper, M. C., Blome, C., & Wuttke, D. A. (2017). The dark side of buyer power: Supplier exploitation and the role of ethical climates. Journal of Business Ethics, 140(1), 97–114.
Sen, A. (1992). Inequality reexamined. Oxford: Oxford University Press.
Singer, A. (2015). There is no Rawlsian theory of corporate governance. Business Ethics Quarterly, 25(1), 65–92.
Snyder, J. (2008). Needs exploitation. Ethical Theory and Moral Practice, 11(4), 389–405.
Snyder, J. (2009). What’s the matter with price gouging? Business Ethics Quarterly, 19(2), 275–293.
Snyder, J. (2010). Exploitation and sweatshop labor: Perspectives and issues. Business Ethics Quarterly, 20(2), 187–213.
Steiner, H. (1984). A liberal theory of exploitation. Ethics, 94(2), 225–241.
Valdman, M. (2008). Exploitation and injustice. Social Theory and Practice, 34(4), 551–572.
Wertheimer, A. (1996). Exploitation. Princeton, NJ: Princeton University Press.
Wood, A. (1995). Exploitation. Social Philosophy and Policy, 12(2), 136–158.
Zwolinski, M. (2007). Sweatshops choice and exploitation. Business Ethics Quarterly, 17(4), 689–727.
Zwolinski, M. (2012). Structural exploitation. Social Philosophy and Policy, 29(1), 154–179.
Acknowledgements
I thank the editor, two anonymous referees and Jeanine Miklós-Thal for helpful comments on a prior draft of this paper.
Author information
Authors and Affiliations
Corresponding author
Ethics declarations
Conflict of interest
The author declares that he has no conflict of interest.
Ethical Approval
This article does not contain any studies with human participants or animals performed by any of the authors.
Rights and permissions
About this article
Cite this article
Miklós, A. Exploiting Injustice in Mutually Beneficial Market Exchange: The Case of Sweatshop Labor. J Bus Ethics 156, 59–69 (2019). https://doi.org/10.1007/s10551-017-3574-7
Received:
Accepted:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s10551-017-3574-7