Henry hansmann ownership of the firm book

Business ethics and the end of history in corporate law. Many firms, for example, are owned by their customers. Syllabus for econ 106i organizational economics spring. To understand hansmanns theory of firm ownership we first need two definitions. Pdf henry hansmann, efficient investor ownership and worker. He has formerly been professor of law at the new york university school of law and the university of pennsylvania law school, and visiting professor of law at the harvard law school. In his book the ownership of enterprise, henry hansmann 1996 develops a theory of ownership costs associated with different organizational forms of entrepreneurship. It displays the breadth of topics in organizational economics, including the roles of individuals and groups in organizations, organizational structures and processes, the boundaries of the firm, contracts between and within firms, and. Henry hansmann, the ownership of enterprise peter kuhn, personnel economics forthcoming. This pdf is a selection from an outofprint volume from. This article is the first chapter of a book authored by r. The book focuses on firms in which ownership is shared by numerous. Hansmann, the ownership of enterprise, supra note 38, at 16. All of these industries are populated with substantial numbers of firms exhib iting each of three fundamentally different ownership types.

A different line of criticism of stakeholder theory builds on henry hansmanns enormously influential work on corporate ownership. Employeeowned firms have long been prominent in the service. The centerpiece of hansmanns view is the claim that ownership of the firm is most naturally exercised by the group able to achieve the lowest costs of ownership, and that homogeneity of interest within the ownership group is a crucial factor in achieving. The key to wealth maximization is to be found in providing ownershiplike incentives to those who control critical, specialized inputs and to align the. Henry hansmann, ownership of the firm 1988 42 journal of law, economics and organization 267. Rethinking corporate governance for the twentyfirst century attempts resolution of this conflict by proposing maximizing total wealth creation by the firm. Notforprofit organizations play a critical role in the american economy. The ownership of enterprise henry hansmann harvard. Fischel the economic structure of corporate law harvard university press 1991. His scholarship has focused principally on the law and economics of organizational ownership and design. He holds a jd 1974 and a phd in economics 1978, both from yale. In the tradition of the theory of the firm he argues that the diverse pattern of ownership p. The handbook of organizational economics, robert gibbons and john roberts, eds.

The governance of notforprofit organizations edward l. Hansmann, henry, firm ownership and organizational form august 1, 2008. The key to the success of a particular form, he shows, depends on the balance between the costs of contracting in the market and the costs of ownership. Review of henry hansmann, the ownership of enterprise, boston and london. My interdisciplinary account is limited to law and economics and perhaps a social theory combining them, but other social sciences are also helpful in studying firms. First, he argues that all other things held equal, costs will be minimized for a firm if ownership is assigned to the class of patrons for whom the. The end of history for corporate law by henry hansmann yale law school reinier kraakman harvard law school abstract despite the apparent divergence in institutions of governance, share ownership, capital markets, and business culture across developed economies, the basic law of the. A comparative and functional approach, by reinier kraakman, john armour, paul davies, luca enriques, henry hansmann, gerard hertig, klaus hopt, hideki kanda and edward rock oxford university press 2009. In health care, education, culture, and religion, we trust notforprofit firms to serve the interests of their donors, customers, employees, and society at large. Firm ownership and organizational form by henry hansmann. Henry hansmann, the ownership of enterprise 1216 1996. Hansmann, ownership of the firm, supra note 38, at 27778.

The book as a whole provides a functional analysis of corporate or company law in europe, the u. The key to the success of a particular form he shows, depends on the balance between the costs of contracting in the market and the costs of ownership. Henry hansmann elaborates and extends this paradigm, an approach he first contributed to the literature on the nature of the firm in a 1988 paper published in. In health care, education, culture, and religion, we trust notforprofit firms to serve the interests of t.

We know that such firms dont try to maximize profits. For instance, a firm may extend its ownership to 3 hansmann 1996, 19 uses. Henry hansmanns research while affiliated with new york law school and other places. He explains why different industries and different national economies exhibit different distributions of ownership forms. Henry hansmann cooperative firms in theory and practice. Henry hansmann, ownership of the firm, journal of law, economics, and organization 42. Henry hansmann explores the reasons for this diverse pattern of ownership. Other ownership patterns are prominent in a number of important industries, however. The handbook of organizational economics surveys the major theories, evidence, and methods used in the field. Hansmann defines a firms owners to be those persons who have two formal rights.

His scholarship has focused principally on the law and economics of organizational. Henry hansmann the investorowned corporation is the conventional form for structuring largescale enterprise in market economies. International journal of voluntary and nonprofit organizations volume 10, pages 271 273 1999 cite this article. The case of art museums sharon oster and willian n.

John armour, paul davies, luca enriques, henry hansmann, gerard hertig, klaus hopt, hideki kanda and edward rock oxford university press 2009. The essential elements of corporate law by john armour. This article is the first chapter of the second edition of the anatomy of corporate law. Ruebhausen professor of law at the yale law school. Ruebhausen professor emeritus of law at yale law school. Introduction most largescale enterprise in the united states is organized in the form of the conventional business corporation, in which the firm is owned collectively by investors of capital. The ownership of enterprise then goes on to apply the theory to a number of diverse sectors, including worker coops, agricultural coops, condominiums, private clubs, nonprofits, insurance, and even traditional corporations which hansmann intriguingly argues are actually a special case of capital supplier coops. Shareholder theory vs stakeholder theory prolific essays. The 2004 election makes it clear that american politics now stands at the intersection of physical space and cyberspace.

Most largescale enterprise in the united states is organized in the form of the conventional business corporation, in which the firm is owned collectively by investors of capital. The book as a whole provides a functional analysis of corporate or company law in europe. Its organization reflects the structure of corporate law across all jurisdictions, while individual chapters explore the diversity of jurisdictional approaches to the common problems of corporate law. By mapping the functions of the internet into the political realm, this paper identifies the potential for internetbased, media reform groups to spearhead fundamental political change. These include not just consumer retail cooperatives, which are relatively. Davies, luca enriques, henry hansmann, gerard hertig, klaus hopt, hideki kanda and edward rock oxford university press, 2009. In each case, he uses a fairly deep historical perspective to look at how.

Most largescale enterprise in the united states is organized in the form of the conventional business corporation, in which the firm is owned collectively by. Agency problems, legal strategies, and enforcement. This is the second edition of this highly regarded comparative overview of corporate law. The ownership of enterprise by hansmann, henry and a great selection of related books, art and collectibles available now at. This is a question addressed by hansmann 1988, 1996, 20. The governance of notforprofit organizations by edward l. Even in the united states, noncapitalist firms play a. Its organization reflects the structure of corporate law across all. In modern economies, largescale enterprise exhibits a variety of ownership forms. In this remarkable book, henry hansmann asks why investor ownership is the dominant but. This article is the second chapter of the second edition of the anatomy of corporate law. Most common and familiar is ownership by those persons individuals or organizations that supply the firm with financial capital. A comparative and functional approach, by reinier kraakman, john armour, paul davies, luca enriques, henry hansmann, gerard hertig, klaus hopt, hideki kanda.

Henry hansmanns research works new york law school and. Henry hansmann has written an important book on a subject on which most. Econ 5463 the economics of organization reading list. Henry hansmann, sam harris professor of law yale law school email. Ownership form and trapped capital in the hospital industry henry hansmann, daniel kessler, and mark mcclellan. His scholarship has focused principally on the law and economics of organizational ownership and structure, and has dealt with all types of legal entities, both profitseeking and nonprofit, private and public. Other forms of ownership are important as well, however, including employee ownership as in partnerships of professionals, ownership by suppliers of other factors. A comparative and functional approach, oxford university press 2004. And nonprofit firms, which have no owners at all, account for 90 percent of all nongovernmental schools and colleges, twothirds of all hospitals.

Ownership of the firm henry hansmann yale university 1. Hmo penetration, ownership status, and the rise of hospital advertising jason r. Syllabus for econ 106i organizational economics spring 2017, department of economics ucla. In this book hansmann considers a wide range of different kinds of. Dominic martin according to henry hansmann, competition in the market puts.