Each year, corporations set their targets. This is quite normal. All corporations around the world not only set their targets each year but also set a higher target than last year. And it continues to rise year after year. Of course, the main points on their agendas are the income, revenue, and profit. No company ever thought about setting the same target as last year. At least, I have never seen or read about such an approach.
Psychological Drivers Behind Growth
Why is this? Definitely, they are not operating to see the exact numbers.
Psychologically, everyone wants to grow due to ambitions and goals. It is amazing that no one ever thought of neutralizing the market share; there is always greed rather than ambition, love of power rather than goals, a tendency to be controlling rather than future visions or aims to enhance. Yet, the question is: what will happen in the long term?
Impact on the Business Cycle
On the other side, the business cycle is affected. Employees still earn the same salaries, still live within the same level. Accordingly, there is no refreshment for the business cycle, leading to challenges that affect the employee, who is the main player in that cycle; he is renting the house, buying groceries, clothes, fuel, etc.
A Microeconomic Example
If we look at this from a micro approach. A country with $1,000 in its economy. One company exists in that country for the sake of the example. 5 employees are running the company. The company’s target is to capture 20% of the market share, which translates to $200. Collectively, 5 employees earn $500, covering their life expenses. When the company increases its target, with the same amount of money being circulated in the economy, someone else must pay for this imbalance, which is normally the employees. However, if the company decides to neutralize its target, several beneficial aspects will emerge, including economic stability, sustainable growth, resilience to crises, and, most importantly, a fair wealth distribution. This example doesn’t consider other variables, such as external forces; however, the negative result can only be observed when purchasing power drops, markets slow down, innovation declines, & most importantly, inequality increases.
