Law and History by Numbers: Use, But with Care
43 Pages Posted: 3 Nov 2013 Last revised: 13 Dec 2013
Date Written: October 28, 2013
This paper, prepared for a University of Illinois College of Law symposium honoring Prof. Larry Ribstein, deals with the historical development of corporate law in the United States, focusing on the promise and perils of quantification. The paper is part of a larger project where we have already deployed the “anti-director rights index” (ADRI), a well-known mechanism for quantifying the protection various nations’ corporate laws offer investors, to “score” Delaware corporate law from the turn of the 20th century to the present day (http://ssrn.com/abstract=2079505). We are currently expanding our research by investigating two additional bodies of corporate law (Illinois and the Model Business Corporations Act) and by taking into account as a second measure of corporate law an “anti-self-dealing index” (ASDI) that focuses on regulation of transactions between a company and those who control it. We identify in this paper various reasons for undertaking a quantitative, historically-oriented analysis of U.S. corporate law. The paper focuses primarily, however, on the logistical challenges associated with such an inquiry. We indicate that it is impossible to code U.S. corporate law historically with clinical precision but nevertheless conclude that the quantification exercise in which we are currently engaging should provide sufficient insights to be worthwhile.
Keywords: Corporate law, corporate governance, law and finance, empirical legal scholarship, leximetrics, anti-director rights index, anti-self-dealing index, competitive federalism
JEL Classification: G38, K22, N21, N22
Suggested Citation: Suggested Citation