85 Pages Posted: 24 Dec 2015  

Randall S. Thomas

Vanderbilt University - Law School; European Corporate Governance Institute (ECGI)

Stewart J. Schwab

Cornell Law School

Robert G. Hansen

Tuck School of Business at Dartmouth

Multiple version iconThere are 2 versions of this paper

Date Written: December 2001


This Article documents and explains the amazing growth of the largest firms in law, accounting, and investment banking. Scholars to date have used various supply-side theories to explain this growth, and have generally examined only one industry at a time. This Article emphasizes a demand-side explanation of firm growth and shows how the explanation is similar for firms in all "project" industries. Legal regulation also plays an important role in determining industry structure. Among the areas covered in this Article are the growth of Multidisciplinary Practice firms (MDPs). MDP growth can best be understood by looking more broadly at the demand forces driving project industries. This Article also applies its framework to the breakup of the Big Five accounting firms, to the consolidation trend in the investment banking industry, and to the divergent growth patterns of the law firms in the plaintiffs' securities litigation field.

Keywords: firms, law, acccounting, investment banking, regulation, Multidisciplinary Practice, industry, securities litigation

Suggested Citation

Thomas, Randall S. and Schwab, Stewart Jon and Hansen, Robert G., Megafirms (December 2001). North Carolina Law Review, Vol. 80, 2001-2002; Tuck School of Business Working Paper No. 2707322; Cornell Legal Studies Research Paper. Available at SSRN:

Randall S. Thomas

Vanderbilt University - Law School ( email )

131 21st Avenue South
Nashville, TN 37203-1181
United States

European Corporate Governance Institute (ECGI)

B-1050 Brussels

Stewart Jon Schwab (Contact Author)

Cornell Law School ( email )

Myron Taylor Hall
Ithaca, NY 14853
United States
607.255.8584 (Phone)
607-255-7193 (Fax)

Robert G. Hansen

Tuck School of Business at Dartmouth ( email )

Hanover, NH 03755
United States
603-646 2079 (Phone)
603-646-1308 (Fax)

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