Evolution and Spontaneous Uniformity: Evidence from the Evolution of the Limited Liability Company

Economic Inquiry, Vol. 34, 1996.

Posted: 2 Jul 1998  

Bruce H. Kobayashi

George Mason University - School of Law

Larry E. Ribstein

University of Illinois College of Law (deceased); PERC - Property and Environment Research Center

Abstract

This paper examines whether the process of unguided state by state evolution of Limited Liability Company (LLC) Statutes has lead to efficient interstate uniformity. Our evidence suggests significant uniformity has been produced in cases where the net benefits of uniformity are positive, and that such uniformity has not been produced by herd behavior. Our results are consistent with Alchian's intuition about the role of market processes, and suggests that the survival of efficient rules, fostered by the rational behavior of decentralized economic actors, are produced by forces beyond the control or foresight of individual lawmakers or legislatures.

JEL Classification: K22, P10, D72

Suggested Citation

Kobayashi, Bruce H. and Ribstein, Larry E., Evolution and Spontaneous Uniformity: Evidence from the Evolution of the Limited Liability Company. Economic Inquiry, Vol. 34, 1996.. Available at SSRN: https://ssrn.com/abstract=10042

Bruce H. Kobayashi (Contact Author)

George Mason University - School of Law ( email )

3301 Fairfax Drive
Arlington, VA 22201
United States
703-993-8034 (Phone)
703-993-8088 (Fax)

HOME PAGE: http://mason.gmu.edu/~bkobayas

Larry Edward Ribstein

University of Illinois College of Law (deceased)

PERC - Property and Environment Research Center

2048 Analysis Drive
Suite A
Bozeman, MT 59718
United States

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