Corporate Law, Finance, and Productivity in Historical Perspective

NSF Award #1658877 and #1658887

Co-PIs: Amanda Gregg and Steven Nafziger

This research project studies the legal and institutional foundations of industrial and financial development in late Imperial Russia. The particulars of commercial, contract, enterprise, and corporate law can have major consequences for how firms are organized and financed, with repercussions for the pace and structure of economic development in a society. We examine the case of the Russian Empire around the turn of the twentieth century, because it offers a combination of uniquely high quality data and a particular set of legal and financial characteristics, all of which make it possible to study the relationships among company law, finance, and firm performance in an industrializing economy. This project collects and analyzes new data while training a large number of undergraduate research assistants in statistical and research methods.

This project involves the collection and analysis of firm-level data describing Russian corporations before the October Revolution of 1917. The data collection is international in scope, drawing on original corporate charters, archival records of firms and financial markets, and a wealth of historical newspapers, government reports, and other materials culled from archives and libraries in the United States, Russia, and Europe. The new dataset links the legal rules governing individual corporations to their subsequent financial characteristics, productivity, and market valuations. The publicly-available databases generated as part of the project are of interest to scholars in diverse fields such as corporate law, finance, economic history, economic geography, industrial organization, and Russian history. The Imperial Russian setting not only offers data of uniquely high quality for a developing economy, but it also provides substantial variation in the legal structures of corporations and in the underlying financial and industrial conditions. This enables the econometric evaluation of causal hypotheses regarding how corporations were financed and how Imperial Russian legal and economic institutions functioned. Thus, this historical project speaks to the role that legal institutions, corporate governance, and finance play in the process of economic development. The project's findings are salient for understanding the historical context of current legal and economic conditions in the Russian Federation, an area of current U.S. policy concern.

Please contact the researchers (linked above) with any questions or comments.