Abstract

http://ssrn.com/abstract=197808
 
 

Citations



 


 



Federalism and Corporate Law: The Race to Protect Managers from Takeovers


Lucian A. Bebchuk


Harvard Law School; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR) and European Corporate Governance Institute (ECGI)

Allen Ferrell


Harvard Law School; European Corporate Governance Institute (ECGI)

May 1999

Harvard Law and Economics Discussion Paper No. 257

Abstract:     
This paper analyzes certain important shortcomings of state competition in corporate law. In particular, we show that, with respect to takeovers, states have incentives to produce rules that excessively protect incumbent managers. The development of state takeover law, we argue, is consistent with our theory. States have adopted antitakeover statutes that have little policy basis, and, more importantly, they have provided managers with a wider and more open-ended latitude to engage in defensive tactics than endorsed even by the commentators most favorable to such tactics. Furthermore, states have elected, even though they could have done otherwise, to impose antitakeover protections on shareholders, who did not appear to favor them, in a way that left shareholders with little choice or say. Finally, we conclude by pointing out that proponents of state competition cannot reconcile their views with the evolution of state takeover law--and should, therefore, reconsider their unqualified support of state competition.

JEL Classification: G30, G34, G38, H70

Accepted Paper Series


Not Available For Download

Date posted: May 26, 2000  

Suggested Citation

Bebchuk, Lucian A. and Ferrell, Allen, Federalism and Corporate Law: The Race to Protect Managers from Takeovers (May 1999). Columbia Law Review, Vol. 99, pp. 1168-1199, 1999. Available at SSRN: http://ssrn.com/abstract=197808

Contact Information

Lucian A. Bebchuk (Contact Author)
Harvard Law School ( email )
Cambridge, MA 02138
United States
617-495-3138 (Phone)
617-812-0554 (Fax)
HOME PAGE: http://www.law.harvard.edu/faculty/bebchuk/
National Bureau of Economic Research (NBER) ( email )
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Centre for Economic Policy Research (CEPR) and European Corporate Governance Institute (ECGI)
Allen Ferrell
Harvard Law School ( email )
Griswold 303 1525 Massachusetts Avenue
Cambridge, MA 02138
United States
(617) 495-8961 (Phone)
(617) 495-1110 (Fax)
European Corporate Governance Institute (ECGI)
c/o ECARES ULB CP 114
B-1050 Brussels
Belgium
HOME PAGE: http://www.ecgi.org
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