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Ernst Freund as precursor of the rational study of corporate law
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Gindis, David (2020) Ernst Freund as precursor of the rational study of corporate law. Journal of Institutional Economics, 16 (5). pp. 597-621. doi:10.1017/S174413741700056X ISSN 1744-1374.
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Official URL: http://dx.doi.org/10.1017/S174413741700056X
Abstract
The rise of large business corporations in the late 19th century compelled many American observers to admit that the nature of the corporation had yet to be understood. Published in this context, Ernst Freund's little-known The Legal Nature of Corporations (1897) was an original attempt to come to terms with a new legal and economic reality. But it can also be described, to paraphrase Oliver Wendell Holmes, as the earliest example of the rational study of corporate law. The paper shows that Freund had the intuitions of an institutional economist, and engaged in what today would be called comparative institutional analysis. Remarkably, his argument that the corporate form secures property against insider defection and against outsiders anticipated recent work on entity shielding and capital lock-in, and can be read as an early contribution to what today would be called the theory of the firm.
Item Type: | Journal Article | ||||||
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Divisions: | Faculty of Social Sciences > School of Law | ||||||
Journal or Publication Title: | Journal of Institutional Economics | ||||||
Publisher: | Cambridge University Press | ||||||
ISSN: | 1744-1374 | ||||||
Official Date: | October 2020 | ||||||
Dates: |
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Volume: | 16 | ||||||
Number: | 5 | ||||||
Page Range: | pp. 597-621 | ||||||
DOI: | 10.1017/S174413741700056X | ||||||
Status: | Peer Reviewed | ||||||
Publication Status: | Published | ||||||
Access rights to Published version: | Open Access (Creative Commons) | ||||||
Date of first compliant deposit: | 21 September 2023 | ||||||
Date of first compliant Open Access: | 21 September 2023 |
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