Law Commons^™

Sharing Among The Human Capitalists: An Economic Inquiry Into The Corporate Law Firm And How Partners Split Profits, Ronald J. Gilson, Robert H. Mnookin

Faculty Scholarship

Large corporate law firms seem to be in a state of extraordinary flux. Success and failure are both on the rise. Large firms appear to supply a substantial and growing proportion of the legal services consumed by American business enterprises and to hire a significant fraction of the graduating classes of elite American law schools. Moreover, the last twenty years have witnessed a remarkable expansion in both the number of large firms and the absolute size of the biggest. But accompanying this striking success, there are also signs of serious institutional instability. During the last few years, several previously successful …

Efficient Markets, Costly Information, And Securities Research, Jeffrey N. Gordon, Lewis A. Kornhauser

Faculty Scholarship

Courts, administrative policy makers and legal scholars have widely embraced the theory that well-developed markets are efficient. In this Article, Professors Gordon and Kornhauser cast doubt on the wisdom of reliance on the efficient market hypothesis as applied to various areas of corporate law. Their charge is that legal decision makers and scholars have misunderstood the assumptions and limitations of the theory and have neglected recent critical economics scholarship. Professors Gordon and Kornhauser begin by detailing the assertions of the hypothesis in relation to the workings of securities markets, focusing on various asset pricing models used to test the hypothesis …

Insider Trading As Victimless Crime, Gary S. Lawson

Faculty Scholarship

Insider Trading as Victimless Crime

Few corporate-governance issues arouse as much indignation in the general press as insider trading. Allowing executives to reap trading profits based on their knowledge of internal corporate developments is widely viewed as grossly unfair-though it is not always clear who is victimized by this unfairness. Sometimes the companies that the insiders work for suffer harm, but other times they welcome the trading. Outside shareholders may envy the profits of inside traders, but proving that they are harmed by the practice is much more difficult. On the whole, the most common grievance against insider trading is …