This is the Cato Daily Podcast for Friday, October 15, 2010. I'm Caleb Brown.

Business is regularly portrayed in public discourse as morally deficient and prone to

despoil the environment, undermine democracy and stunt development.

And Bernstein's new book, The Case for Business in Developing Economies, takes on those beliefs.

She calls on business leaders to stand up for themselves and defend the role of business as an instrument of progress.

She spoke at the Cato Institute September 28th.

Now you can divide normal company activities and their impact into what I've called direct and indirect

impacts.

These are not very satisfactory terms and one of the, I think conclusions I have come to is we don't really have a good language to even describe

the positive impact of companies and the associated issues.

What are direct impacts? I think you could say that modern

business is the most powerful engine ever invented of innovation, of large-scale organization and transmission of no-how across frontiers.

That's of course in addition to those minor things like creating wealth jobs paying taxes things we all depend on.

Now the limited liability corporation has been called by some authors the greatest single

discovery of modern times. The mechanism through which companies increase the pool of capital

available for productive investment. It allows investors to

spread their risk by purchasing small and easily marketable shares in several

enterprises and it provides a way of imposing effective management

structures on large organizations. It also has the capacity to fail with relatively low social costs.

And it's true this mechanism that today's corporations can finance and manage large-scale operations.

Companies are uniquely effective in making human effort productive.

Specialised resources in the form of labour, raw and finished materials, capital and knowledge come together

...