History 1807 Lecture Notes - Lecture 14: Louis Brandeis, Conditionality, South Sea Company
21 Apr 2016
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History: charters were given out for set time period with specific powers. Business ventures designed to enrich the investors that came with large amount of power. Gave opportunity to create order merchants need order and stability. Given power to control the land they were given. Canada and the united states emerged out of chartered companies. State deriving level of prestige and benefits of return on investment. Merchant gaining new markets and access to wealth. By 16th/17th century, there are corporations being created and chartered to: Able to attract large number of investors b/c they know their principal is the only thing they"ll lose. Corporation ceases to be seen as creature of state and controlled by state becomes independent. Investors not going to invest unless has limited liability. Adam smith thought was loss of individual responsibility. Removes risk from investment nothing to check someone"s investment with. The more corporations move to the fore growing divergence between ownership and management of company.
