Holley’sCondition of Acceptable Change
CourseCode and Title
Holley’sCondition of Acceptable Change
Holley’scondition of acceptable change obliges the salesperson to provide thenecessary information to his customers of what any ordinary andreasonable person would find important and if the details arerelevant to any customer concerning any product or service beingsold. Holley’s condition of acceptable change states that abusiness transaction should occur based on the following conditions
Knowledge: Both seller and buyer of the service or good should know what they are getting involved.
Non- interference: Both seller and buyer should not be forced to engage in any activity.
Rational decision: Both are able to make reasonable judgments concerning the product.
Majorityof countries in the world have prohibited the advertising andpromotion of cigarettes. In some states, there is controlledadvertising where extra information regarding effects of smoking on aperson`s health. When buying a packet of cigarettes, Holley`sconditions of acceptable change are not satisfied. Despite provisionof information on the packets, the smoker`s health may be at risk, itdoes not also give the constituent chemicals in tobacco that causeillness.
Theshareholder/ stakeholder theorem of corporate social responsibilityrequires that the service or product provider only have the interestsof its shareholder when selling its product. In the case ofcigarettes, provision of extra unsolicited information of thecigarettes constituents, would therefore affect the profits andconsumption of the product. The stakeholder side though dictates theimportance of the consideration of the customers` welfare. Thecigarette manufacturers ensure this by displaying the minimal healthrisk information that would give an insight into the risks associatedwith cigarette smoking. This kind of act goes against the moral codeof the stakeholder theory which dictates that every person has anobligation to the welfare of each human being.
Regardlessof the health risks associated with cigarette use, an individual isaware of what they are purchasing. When purchasing a packet ofcigarettes, a person is not coerced or forced to buy the cigarette.Despite the information available about cigarettes, a person has theliberty of choice to consume the product. A person`s ability to makea reasonable judgment on whether to consume the product depends onthe level of addiction. Considering the factor of paternalism, theaddiction of the customer to the cigarette may compel him to buy thecigarette. Paternalism though goes against Holley’s condition ofreasonable judgment. The first condition of Holley states that bothseller and buyer of the service or good should know what they aregetting involved. The authority`s control of cigarette use goesagainst this condition considering that the cigarette sales targetthe adult population who have the ability to make their own choices.
Abig Mac meal being a fast food meal has been reviewed by theconcerned authorities over its role in the levels of obesity andobesity related complications resulting from consumption of highcholesterol meals. These meals are appealing, delicious and priceefficient: a quick meal on the go. There is enough information on theeffects of following a low cholesterol diet although authorities donot enforce the need to follow such a diet. When purchasing a big Macmeal, Holley’s conditions are not wholly satisfied. The consumersare aware of the meals they buy. Despite the levels of obesityobserved in zones where fast food consumption is high, the restaurantdoes not volunteer information about the high levels of cholesterolin their meals. From the shareholder/ stakeholder theorem ofcorporate social responsibility, Big Mac meal restaurants lack astakeholder approach and moral obligation. They do not display thelevels of cholesterol found in their meals despite them havingknowledge of their contribution to the obesity health problem and itseffects on Big Mac’s customers.
Thedifferential treatment of marketing fast food products and cigarettesis not justified. Cigarette consumption has been on the decline dueto laws and prohibitions in its marketing while fast foodrestaurants, kiosks and businesses are not on the kinds of meals theysell despite the high levels of cholesterol they have. Obesity,therefore, is not checked and has become an epidemic. It isunjustified to give differential treatment to the marketing ofcigarettes while meals high in cholesterol are without anyprohibitions.
Theconsideration by the Australian government to introduce regulationsrequiring gamblers to nominate the amount in advance they would beprepared to lose before the start of playing a poker machine isunjustified. The regulations are unjustified since due to theirinterference with a person’s liberty. A gambler is well aware ofthe loss or wins that he may incur while gambling. When the casinoopens, it does not compel anyone to gamble. The probability ofwinning or losing should not be regulated otherwise it would not begambling. When a gambler plays poker, they are aware of losing orwinning, therefore, satisfying Holley`s first condition of knowledge.The gambler is not also forced to play the game although paternalismplays a role. Gambling is addictive, and the individual is compelledto play so they can win like they once did.
Inthe gambling situation, ‘the house always wins` is a phrase wellknown to each gambler. The casino, obeying the facts of paternalism,however unfair or unethical it may seem, is not compelled to givethis information of how many chances a gambler has of winning againstthe poker machine. When playing the poker machine that has not been,probability of losing should be equal to the probability of winning.The Australian government, therefore, cannot be justified inintroducing the regulations. The casino management and itsshareholders, following the shareholder theory are under noobligation to divulge the number of loss or wins a gambler has. Itwould be unethical therefore to try and dictate the outcome of agambling situation by the Australian government.
Holley’smodel of acceptable change dictates that a transaction should followthe conditions of knowledge, non- interference and rational decisionmaking on any good or service. Holley’s model of informationdisclosure is up of five levels. They include:
Maximum information rule where all the relevant information is provided.
Mutual benefit information rule where the safety information and information available enables a person to make a reasonable judgment.
Fairness rule includes all the safety information associated with the product and unavailable information.
Modified Minimal Information where the seller only offers information necessary to avoid risks associated with using the product.
Minimal Information, where there is little or no information available, and the buyer is responsible for use of the product or service.
Mill`sideas on paternalism, marketing and disclosure dictate theinformation, the seller should provide to prevent harm to the buyers.Mill notes that a person is at liberty to choose the service or goodif he fully understands and has information about the good orservice. His ideas on paternalism also dictate that a person shouldbe from using anything that would cause harm unless they are fullyaware and not ignorant.
Amarketing practice considered for a sophisticated group as studentswould not be appropriate for a vulnerable group such as unlearnedpeople. Unlearned people are unable to decipher marketing informationpassed on to them. They are, therefore, at risk of manipulationduring the marketing process to use a good or service. Asophisticated group, on the other hand, would understand and have theability to make reasonable judgments against any product. Asophisticated group with the ability of making rational judgmentswould therefore have anti-paternalism sentiments, unlike thevulnerable unlearned group. A company or service provider is obligedto provide information about their product through awareness andeducation, to root out ignorance from a person before giving them thechoice to use the product or not. This will be in line with thestakeholder theorem of corporate social responsibility.
Inconclusion, due to lack of a perfect business environment, businessethics should be observed especially in marketing. Fair and justtreatment in the marketing field should be given to products that maycause harm to a person intending to use them and sufficientinformation should be provided.