SOSC 2330 Lecture Notes - Lecture 13: Transaction Cost, Free Market, Legal Personality
29 Nov 2017
School
Department
Course
Professor
Document Summary
Monopoly: unfair market control, laissez-faire, free market. Limited liability: shareholders only lose what they invest. Joint stock company: pool capital together fro collective endeavors. East india company: pool money into india from europe, military power, capital. Corporation is successful in u. s because they internalized transaction cost. To seek incorporation is to seek legal status. Corporation is an entity: assets, buy or sell property/ sue or be sued, legal entity. Corporations have managers: separate from owners who are shareholders, shareholder is separated from assets, get dividend, only lose investment. Investor in corporation but do not lose assets: they don"t let their investors know company actions because they don"t want secrets out. Vertical integration: control everything under one company.
