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The Limited Partnership in New York, 1822–1858: Partnerships Without Kinship

Published online by Cambridge University Press:  01 September 2009

Eric Hilt  and
Katharine O'Banion
Eric Hilt*
Affiliation:
Assistant Professor, Department of Economics, Wellesley College, Wellesley, MA 02481; and Faculty Research Fellow, NBER. E-mail: [email protected].
Katharine O'Banion*
Affiliation:
Katharine O'Banion is J.D. Candidate, Yale Law School, P.O. Box 208215, New Haven, CT 06520–8215. E-mail: [email protected].
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Abstract

In 1822 New York became the first of many common law states to authorize the formation of limited partnerships. Little is known about the effects of these statutes. This article analyzes the use of the limited partnership in nineteenth-century New York City. We find that the form was adopted by a surprising number of firms, and that limited partnerships had more capital, failed at lower rates, and had fewer members with kinship ties, compared to ordinary partnerships. The results suggest that the introduction of the limited partnership facilitated investments that would not have occurred in the absence of the form.

Type
ARTICLES
Information
The Journal of Economic History , Volume 69 , Issue 3 , September 2009 , pp. 615 - 645
Copyright
Copyright © The Economic History Association 2009

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