The Productive Association—A Proposal for a New Legal Entity for Management in an Age of Equality

Since the 1840's, the corporate form has grown to become the dominant vehicle for carrying on all kinds of business and commerce in the developed world and in most parts of the developing world. It started as a simple response to the dangers of bankruptcy, which could formerly have put a trader in prison for life. Then it grew, as more and more traders sought the protection of limitation of liability. Also, limited liability form allowed a trader to raise much more money than he could find on his own. People with a lot of money were reluctant to take a partnership, with unlimited liability, so the capital needs of industrial expansion could only be met through the corporate form. The economic development of the industrial world since that beginning is a testimony of the effectiveness of the corporate form as a legal vehicle of considerable power. With very few exceptions, it has served the industrial world well for over a century.