Corporate Law And Economics

This text argues that the rules and practices of corporate law mimic contractual provisions that parties involved in corporate enterprise would reach if they always bargained at zero cost and flawlessly enforced their agreements. It states that corporate l

The past decade has brought certain corporate transactions and arrangements to the forefront of public attention and debate. At the same time, a new mode of corporate law analysis has been developed--one that uses economics to identify the consequences and desirable features of corporate law rules. This collection of papers uses economic analysis to study some of the main issues in corporate law. By collecting work at the frontier of this method of analysis, the volume provides a clear picture of the power, current state, and future direction of the economic analysis of corporate law. Written by some of the most prominent contributors to the field, many of the papers focus directly on the corporate control transactions that have attracted much interest and controversy in the past decade--corporate takeovers, buyouts, recapitalizations, and reorganizations.

Corporations classes present students with two related problems: First, many students have trouble understanding the cases studied because they do not understand the transactions giving rise to those cases. Second, Corporations classes at many law schools are taught from a law and economics perspective, which many students find unfamiliar and/or daunting. Yet, with few exceptions, corporate law treatises and other study aids have essentially ignored the law and economics revolution. Corporations Law and Economics is intended to remedy these difficulties. The pedagogy is up-to - date, with a strong emphasis on the doctrinal issues taught in today's Corporations classes and, equally important, a mainstream economic analysis of the major issues in the course. As such, the text is coherent and cohesive: It provides students not only with an overview of the course, but also (and more importantly) with a unifying method of thinking about the course. Using a few basic tools of law and economics-price theory, game theory, and the theory of the firm literature-students will come to see corporate law as the proverbial ?seamless web.' Finally, the text is highly readable: The style is simple, direct, and reader- friendly. Even when dealing with complicated economic or financial issues, the text seeks to make those issues readily accessible.

In this timely book, the law and economics of corporate governance is approached from a range of angles. This study reveals that perspectives are changing: they differ between the economic and the legal standpoint; they vary across countries; they evolve over time. A group of leading scholars offer their views some provide fresh empirical evidence on existing theories and others attempt to develop new theoretical insights based on empirical puzzles. They all analyse the economics of corporate governance with a view to how it should, or should not, be regulated. Economic analysis of law proves to be the common language for understanding corporate governance on both sides of the Atlantic. The law and economics approach is applied to topical issues in the international debate, such as the harmonization of company laws; regulatory competition; determinants of separation of ownership and control; enforcement of investor protection; and the political economy of corporate governance.

Comprising essays specially commissioned for the volume, leading scholars who have shaped the field of corporate law and governance explore and critique developments in this vibrant and expanding area and offer possible directions for future research. This important addition to the Research Handbooks in Law and Economics series provides insights into subjects such as the role of directors, shareholders, creditors and employees; empirical studies of litigation and shareholder activism; executive compensation; corporate gatekeepers; comparative law; and behavioral approaches to law and finance. Topics are organized within five sections: corporate constituencies, insider governance, gatekeepers, jurisdiction, and new theory. Taken as a whole, the volume serves as an introduction for those new to the field and as a reference for those unfamiliar with some of the topics discussed. Authoritative and accessible, the Research Handbook on the Economics of Corporate Law will be a valuable resource for students, scholars, and practitioners of corporate law and economics.

This book takes a comparative law and economics approach to the study of corporate governance. It looks at the overall impact of corporate law on separation of ownership and control across different jurisdictions and in doing so reappraises the existing framework for economic analysis of corporate law.

This book is a continuation of Corporate Law and the Theory of the Firm: Reconstructing Corporations, Shareholders, Directors, Owners, and Investors. The author extends his analysis of contract law, property law, agency law, trust law, and corporate statutory law and applies that analysis to defy conventional concepts and theories in economics, finance, investment, and accounting and expose the artificial boundaries established by decades of research founded on indefensible assumptions and fallacious conclusions. Using the Humpty Dumpty principle, where words mean what the authors want them to mean, economists have created "strange new worlds" where contract law, property law, agency law, and corporate statutory law no longer apply. The author dismantles the theory of the firm by proving the theory of the firm wilfully and intentionally ignores fundamental contract law, property law, agency law, and corporate statutory law. Contrary to the theory of the firm, shareholders do not own corporations, directors are not agents of shareholders, and shareholders are not investors in corporations. The author proves that by property law and corporate law, capital is not privately owned by capitalists but by corporations. Entire economic and social systems have been constructed that have no basis in law. With the advent of publicly traded corporations, the capital is there, but both capitalists and capitalism have been rendered extinct. This book will appeal to researchers and graduate and upper-level undergraduate students in economics, finance, accounting, law, and sociology, as well as legal scholars, attorneys and accountants.

Dozens of judicial opinions have held that shareholders own corporations, that directors are agents of shareholders, and even that directors are trustees of shareholders’ property. Yet, until now, it has never been proven. These doctrines rest on unsubstantiated assumptions. In this book the author performs a rigorous, systematic analysis of common law, contract law, property law, agency law, partnership law, trust law, and corporate statutory law using judicial rulings that prove shareholders do not own corporations, that there is no separation of ownership and control, directors are not agents of shareholders, and shareholders are not investors in corporations. Furthermore, the author proves the theory of the firm, which is founded on the separation of ownership and control and directors as agents of shareholders, promotes an agenda that wilfully ignores fundamental property law and agency law. However, since shareholders do not own the corporation, and directors are not agents of shareholders, the theory of the firm collapses. The book corrects decades of confusion and misguided research in corporate law and the economic theory of the firm and will allow readers to understand how property law, agency law, and economics contradict each other when applied to corporate law. It will appeal to researchers and upper-level and graduate students in economics, finance, accounting, law, and sociology, as well as attorneys and accountants.

Many students find their Corporation Law class difficult because they do not understand the transactions giving rise to those cases. As with its predecessors, this third edition is intended to assist students by not only restating the law but also by putting the law into its business and financial context. The pedagogy is up-to-date, with a strong emphasis on the doctrinal issues taught in today's Corporations classes. The text is highly readable: The style is simple, direct, and reader-friendly. Even when dealing with complicated economic or financial issues, the text seeks to make those issues readily accessible. This new edition brings the material up-to-date with complete coverage of developments in both state corporate law and federal securities law.

Recent high-profile corporate scandals—such as those involving Enron in the United States, Yukos in Russia, and Livedoor in Japan—demonstrate challenges to legal regulation of business practices in capitalist economies. Setting forth a new analytic framework for understanding these problems, Law and Capitalism examines such contemporary corporate governance crises in six countries, to shed light on the interaction of legal systems and economic change. This provocative book debunks the simplistic view of law’s instrumental function for financial market development and economic growth. Using comparative case studies that address the United States, China, Germany, Japan, Korea, and Russia, Curtis J. Milhaupt and Katharina Pistor argue that a disparate blend of legal and nonlegal mechanisms have supported economic growth around the world. Their groundbreaking findings show that law and markets evolve together in a “rolling relationship,” and legal systems, including those of the most successful economies, therefore differ significantly in their organizational characteristics. Innovative and insightful, Law and Capitalism will change the way lawyers, economists, policy makers, and business leaders think about legal regulation in an increasingly global market for capital and corporate governance.