There was a post on this sub that seemed to convert a lot of people to believing limited liability could be produced without a state using contracts. Unfortunately I can't remember who made the post.

I do remember this piece being posted awhile back: The Corporate Form, Limited Liability, and the State - Edmond S. Bradley

Personally I think several of Bradley's arguments are lacking but it got my mind thinking about how limited liability could be created without a state using contracts.

I believe limited liability could be created for the majority of shareholders, but I don't see how a completely separated legal entity could be created without the state.

A simple example would be: I start a company. I sell shares to the company. With each of those shares is a contract that basically says: "I, zoink, personally take on all liabilities when it comes to this company."

This could be expanded with more people taking on liability and insurance to create something similar to limited liability.

Still, I think true limited liability would only be possible for people who were deemed to have an immaterial amount of responsibility and knowledge when it came to a company. Take aletoledo comment concerning a kidnapping company. I doubt practically anyone who invested in "Kidnapping inc." is going to have much luck freeing themselves from liability.

Other Threads:

Limited Liability

Apparently, even some libertarians believe that corporations would exist without the state. How do you argue with such vague assumptions as these?