Nexus of Contracts


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Nexus of Contracts

Any contract or other thing that is related to anything else, especially something that causes something else.
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Not surprisingly, he finds that the investor capitalism model is operating regardless of the fact that the nexus of contracts that forms the foundation of agency theory is basically an ideological belief that does not rest on any foundations in mainstream corporate law or judicial holdings.
The seeds for Boilermakers and ATP Tour were sewn three decades ago with the metaphorical pronouncements by many commentators that the corporation is but a "nexus of contracts." (10) The expression is impactful because it is more than just a metaphor; it has substantive bite.
Moreover, they might signal the final gasp of the nexus of contracts theory--at least in its descriptive guise.
(3) Berkahn uses the term 'contractarian' to describe both the conception of the company as founded on a contract between the shareholders and the modern nexus of contracts analysis of the corporation.
Viewing the firm as a nexus of contracts at first instance provides a conceptual basis for challenging the dominant shareholder ideology which, critics such as Lazonic and O'Sullivan (2000) argue, has proved to be counterproductive to both the generation and distribution of wealth in the Anglo-American variety of capitalism.
* Kenneth Ayotte, Northwestern University Law School, and Henry Hansmann, Yale University, "A Nexus of Contracts Theory of Legal Entities"