Maximize *what*?

At Boing Boing, Cory Doctorow points us to a fantastic rant at Crooked Timber:

...I have a real bee in my bonnet about the claim made by Richard Posner that ” The managers of corporations have a fiduciary duty to maximize corporate profits”. It raises a whole load of topics relevant to plenty of my favourite economic hobby-horses as soon as you start to look remotely critically at what the seemingly simple phrase “maximise corporate profits” actually means anyway.

Pretending not to understand the meanings of common English phrases is a stock tactic for creating the impression of profundity (cf philosophers, who are always pretending not to understand the meaning of words like “is”, “would” and “must”). But sometimes you have to do it – my view is that in any view of the world more complicated than a very elementary blackboard model, the phrase “maximise profits” can’t be unpacked into a coherent decision rule which rules out any of the things which Posner talks as if it does. First, let’s look at some things that it can’t possibly mean...

What obligation? Maximise what? (Crooked Timber)

(via)