I think no company should be allowed limited liability/bankruptcy protection.
If a company can't pay its debts, the shareholders should be required to pay.
If a company can't pay its debts, the shareholders should be required to pay.
We had this. For millennia. It simply makes equity impossible. Instead, you have proprietors who get loans--all investment is debt.
this is not true. investors are merely incentivized to be more careful about who they trust with their money.
Sure. And they'd be more careful by structuring investments as debt. If you're taking joint liability, you're a proprietor. Limited liability is equity's defining characteristic. Equity with liability is proprietorship. A world without limited liability is one without equity.
if I've misunderstood the thrust of your replies then I apologize.
The actual counter-example you seek is partnerships. The difference between stock and partnership is limited liability.
if you say so, but your point is hard to grasp because here are examples of people owning capital without a liability shield. And plenty of liability limited companies are also levered.
> The actual counter-example you seek is partnerships.
https://www.investopedia.com/articles/investing/090214/limit...
> The difference between stock and partnership is limited liability.
Yes, kings and lords. (Today: proprietors.) We reformed the system so more than the rich could be capitalists.
To your links: LLPs are not pure partnerships. They’re an equity-like structure with limited liability. If you are arguing against limited liability, limited-liability partnership obviously doesn’t comport.
And: joint-stock companies are not germane to your argument. They join distributed ownership (first, in the Song dynasty) with limited liability (in the West). Without limited liability, they’re analogous to a bond register.
I don’t know literature I can reference to concisely clarify this. English and Delaware law introductory texts may be good starting points. The histories of joint-stock companies, incorporation and indemnification might follow.