This week, I am recommending two papers:
M. Todd Henderson (University of Chicago – Law School) has posted Two Visions of Corporate Law on SSRN. Here is the abstract:
In
a recent paper, Professor Robert Ahdieh argues that the debate about
whether corporate law federalism leads to a race to the top or the
bottom is pointless because state corporate law has little to do with
the quality of corporate governance. Ahdieh thinks that markets, like
those for corporate control and labor, are what make corporate
governance what it is, not state competition for corporate charters.This essay, which will appear in the George Washington Law Review as
part of a colloquy on Ahdieh’s thought-provoking paper, argues that the
race debate matters because while the market for corporate control
disciplines managers, it is competition among states that disciplines
states from distorting the market for corporate control.After showing that the race debate matters, the essay then tries to
explain the persistence and ideological valence of the debate. Why is
it that the debate continues despite innumerable empirical and
theoretical studies on both sides, and why is it that defenders of the
federalism model are mostly conservatives and critics are mostly
liberals? The answer to both questions is that the race debate is
really a conflict between two visions of corporate law held by these
groups. Using the framework developed by Thomas Sowell, the essay shows
how the split in the academic community about the optimality of the
corporate law model can be explained by one’s faith in experts (what
Sowell calls the "unconstrained" vision) or by one’s faith in
processes, like markets (what Sowell calls the "constrained" vision).
The essay then offers some preliminary thoughts on the implications of
this description for corporate law scholarship and some ideas on how to
move the debate forward.
Originalism
and Regulatory Takings: Why the Fifth Amendment May Not Protect Against
Regulatory Takings, But the Fourteenth Amendment May by Michael B. Rappaport:
This
articles explores the widely disputed issue of whether Takings Clause
protects against regulatory takings, offering a novel and intermediate
solution. Critics of the regulatory takings doctrine have argued that
the original meaning of the Fifth Amendment Takings Clause does not
cover regulatory takings. They have quickly moved from this claim to
the conclusion that the incorporated Takings Clause under the
Fourteenth Amendment also does not cover regulatory takings.In
this article, I accept the claim that the Fifth Amendment Takings
Clause does not cover regulatory takings, but then explore the
possibility that the incorporated Takings Clause does cover such
takings. Applying Akhil Amar’s theory of incorporation, I argue that
there are strong reasons, based on history, structure, and purpose, to
conclude that the Takings Clause had a different meaning under the
Fourteenth Amendment. Amar argues that the Bill of Rights was dominated
by republican ideas, but that the Fourteenth Amendment was founded on
more liberal notions intended to protect individual rights. This would
suggest that a broad reading of the Takings Clause would further the
principles underlying the Fourteenth Amendment.Moreover,
that some state courts had come to apply takings principles to
regulatory and other nonphysical takings in the period between the
enactment of the Bill of Rights and the Fourteenth Amendment provides
additional support for the possibility that the Fourteenth Amendment
enactors would have understood it to apply to regulatory takings. While
the paper does not attempt to prove that the Fourteenth Amendment
Takings Clause applies to regulatory takings, leaving that task to
others, it argues that critics of regulatory takings doctrine should no
longer simply assume that the Constitution’s original meaning does not
apply to state regulatory takings.
Both papers are highly recommended.