Why We Need Multistate Business Entities

Business entities are generally formed state-by-state. While this separatist approach has many shortcomings, scholars and policymakers have considered only one alternative: the federalization of business entity formation. Yet limiting the choices to two is false and distortive. It is false because another alternative – multistate formation and regulation of business – is possible. It is distortive because it deprives policymakers of the advantages of multistate corporations and other business entities. In a new article, we show that multistate business entities are, in fact, preferable to both state separatism and federalization.

Background on the Market for Entity Formation

When entrepreneurs … Read more