Law Commons^™

Employees And The Boundaries Of The Corporation, Matthew T. Bodie

All Faculty Scholarship

Employees have no formal role in U.S. corporate law. According to most theories of the firm, however, employees play a critical role in differentiating firms from markets. This essay examines the disparity in treatment and seeks to understand the ramifications of the separation of employees from the corporation. After discussing the absence of employees from the corporate structure, the essay looks at the role of the employees in theories of the firm. In contrast to corporate law, these theories generally include employees within the core of the firm, and they often explain the nature and purpose of the firm in …