The Corporation and the Constitution

Much of America's business is conducted through corporations, and corporate wealth is duly subject to governmental regulation. It follows that constitutional protection of corporations' business activities and ability to participate in political debate is crucial to American productivity. A problem arises, however, because the courts typically place a low value on the business activities of corporations.
The authors seek to correct traditional misconceptions about the corporate form of enterprise. Legal and constitutional treatment of the corporation, they argue, is out of touch with economic and business reality. They articulate a contractual theory of the corporation that is based on the modern economics of the firm and then pragmatically apply this theory to the interpretation of constitutional doctrine.
The Corporation and the Constitution is a significant contribution to modern constitutional and corporate scholarship. It offers a coherent theory of applying the Constitution to the corporation, and it forces scholars to appreciate the developments that have taken place totally outside the realm of traditional scholarly discourse on the Constitution. This shows that in formulating constitutional rules it is at least as important to understand the real-world context of particular problems to which the Constitution is applied as it is to develop a global framework of constitutional analysis.

Henry N. Butler is a professor law and economics at the University of Kansas. Larry Ribstein is a professor of law at the George Mason University School of Law.