It is commonplace to credit the invention of the public corporation as an important engine of economic growth. The creation of a long-lived vehicle that gave investors both tradable shares and limited liability allowed talented managers to raise capital to fund enterprise. Writing in 1926, the Economist magazine heralded this role:
The economic historian of the future may assign to the nameless inventor of the principle of limited liability, as applied to trading corporations, a place of honor with Watt and Stephenson, and other pioneers of the Industrial Revolution. The genius of these men produced the means by which man’s command of natural resources has multiplied many times over; the limited liability company the means by which huge aggregations of capital required to give effect to their discoveries were collected, organized and efficiently administered.
Business Organizations Law | Law | Law and Economics
Ronald J. Gilson,
The Nordic Model of Corporate Governance: The Role of Ownership,
The Nordic Corporate Governance Model, Per Lekvall, Ed., SNS Förlag (2014)
Available at: https://scholarship.law.columbia.edu/faculty_scholarship/1895