The Myth of State Competition in Corporate Law

72 Pages Posted: 2 Jan 2003

See all articles by Marcel Kahan

Marcel Kahan

New York University School of Law; European Corporate Governance Institute

Ehud Kamar

Tel Aviv University - Buchmann Faculty of Law; European Corporate Governance Institute (ECGI)

Abstract

This Article challenges the conventional wisdom that states compete for incorporations. Delaware aside, no state stands to gain meaningful tax revenues or legal business from chartering firms, and no state takes significant steps to attract incorporations. The explanation for this apathy lies in a combination of economic entry barriers and political factors. This analysis of the market for incorporations has implications for the present structure of corporate law, for the desirability of federal intervention, and for theories of regulatory competition in general.

Keywords: Delaware, Incorporation, Corporate Charters, Corporate Governance, Regulatory Competition, Managers, Shareholders, Takeovers, Barriers to Entry, Network Externalities, Federalism, Legislation, Public Choice, Political Economy, Franchise Tax

JEL Classification: G30, G38, H70, K22, H25, H71, H73, L13, R58

Suggested Citation

Kahan, Marcel and Kamar, Ehud, The Myth of State Competition in Corporate Law. Stanford Law Review, Vol. 55, p. 679, 2002. Available at SSRN: https://ssrn.com/abstract=334120 or http://dx.doi.org/10.2139/ssrn.334120

Marcel Kahan

New York University School of Law ( email )

40 Washington Square South
New York, NY 10012-1099
United States
212-998-6268 (Phone)
212-995-4341 (Fax)

European Corporate Governance Institute ( email )

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

Ehud Kamar (Contact Author)

Tel Aviv University - Buchmann Faculty of Law ( email )

Ramat Aviv
Tel Aviv 69978, IL
Israel
972-3-6407301 (Phone)

European Corporate Governance Institute (ECGI)

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

Register to save articles to
your library

Register

Paper statistics

Downloads
1,177
Abstract Views
4,976
rank
16,960
PlumX Metrics