Corporate law expresses a profound ambiguity toward the role of shareholders. Courts announce that shareholders are quot;critical to the theory that legitimates the exercise of power - by directors and officers over vast aggregations of property that they do not own.quot; At the same time...

Venture capital contracts contain extensive provisions regulating exit by the venture capitalists. In this Article, Professor Smith employs financial contracting theory in conjunction with original data collected from 367 venture-backed companies to analyze these exit provisions. He concludes...

This paper is the first attempt to study the process and criteria used by entrepreneurs in evaluating venture capitalists. Selection process involves issues such as the time invested in gathering information, the sources of information, and the number of venture capitalists considered. Selection...

Entrepreneurs and venture capitalists engage in quot;team production.quot; Inherent in team production is an incentive problem: team members have an incentive to shirk. The incentive to shirk derives from the inability to monitor team members perfectly and compensate them based on productivity....

The doctrines of good faith and fair dealing, fiduciary duty, and unjust enrichment are doctrines of last resort because they are activated only when all other potentially applicable commands from constitutions, statutes, regulations, ordinances, common law decisions and contracts have been...

Discretion is an important feature of all contractual relationships. In this Article, we rely on incomplete contract theory to motivate our study of discretion, with particular attention to fiduciary relationships. We make two contributions to the substantial literature on fiduciary law. First,...

This chapter from the forthcoming Research Handbook on the Economics of Corporate Law (Claire Hill & Brett McDonnell, eds.) examines the role of shareholders in the modern American public corporation. The chapter starts with the Berle and Means (1932) problem of the separation of ownership and...