Working Paper: CEPR ID: DP3006
Authors: Lucian Arye Bebchuk; Allen Ferrell
Abstract: In a recent article, we have put forward a new approach to takeover law and regulatory competition. We proposed a ?choice-enhancing? federal intervention that would provide: (i) an optional body of substantive federal takeover law which shareholders would be able to opt into (or out of) and which would be more hospitable than existing state takeover law, and (ii) a mandatory process rule that would provide shareholders the right to initiate and adopt, regardless of managers? wishes, proposals for option into (or out of) the federal takeover law. In this Paper, we respond to critics of our proposal, and we further develop the case for it.
Keywords: federal takeover; regulatory competition; shareholder; state takeover; takeover law
JEL Codes: G30; H70; K22
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Federal intervention (H77) | Enhanced shareholder choice (G34) |
| Mandatory federal process rule (L98) | Improved shareholder rights (G38) |
| Mandatory federal process rule (L98) | Removal of distortions in decision-making (D79) |
| Shareholder initiation of votes for reincorporation (G34) | Alignment of corporate governance with shareholder interests (G38) |
| Federal intervention (H77) | Counteracting managerial opportunism (D23) |