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The Corporation as Time Machine: Intergenerational Equity, Intergenerational Efficiency, and the Corporate Form

39 Pages Posted: 30 Jan 2015  

Lynn A. Stout

Cornell Law School - Jack G. Clarke Business Law Institute

Date Written: January 28, 2015

Abstract

This Symposium Article argues that the board-controlled corporation can be understood as a legal innovation that historically has functioned as a means of transferring wealth forward and sometimes backward through time, for the benefit of present and future generations. In this fashion the board-controlled corporation promotes both intergenerational equity and intergenerational efficiency. Logic and evidence each suggest, however, that the modern embrace of “shareholder value” as the only corporate objective and “shareholder democracy” as the ideal of corporate governance is damaging the corporate form’s ability to serve this economically and ethically important function.

Suggested Citation

Stout, Lynn A., The Corporation as Time Machine: Intergenerational Equity, Intergenerational Efficiency, and the Corporate Form (January 28, 2015). Available at SSRN: https://ssrn.com/abstract=2556883 or http://dx.doi.org/10.2139/ssrn.2556883

Lynn A. Stout (Contact Author)

Cornell Law School - Jack G. Clarke Business Law Institute ( email )

Myron Taylor Hall
Cornell University
Ithaca, NY 14853-4901
United States
607-255-8431 (Phone)

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