50 Things That Made The Modern Economy With Tim Harford

Nicholas Murray Butler was one of the thinkers of his age, a philosopher, Nobel Peace Prize

winner, President of Columbia University.

In 1911, someone asked Butler to name the most important invention of the industrial era.

Steam, perhaps.

Electricity?

No, he said.

They would both be reduced to comparative impotence without something else, something

he called the greatest single discovery of modern times.

That's something.

The Limited Liability Corporation.

It seems odd to say the corporation was discovered, but they didn't just appear from nowhere.

The word incorporate means take on bodily form, not a physical body but a legal one.

In the law's eyes, a corporation is something different from the people who own it or run

it or work for it.

And that's a concept law makers had to dream up.

Without laws saying that a corporation can do certain things like own assets or enter

into contracts, the word would be meaningless.

The legal ingredients that comprise a corporation came together in a form we would recognise in

England on New Year's Eve in 1600.

Back then, creating a corporation didn't simply involve filing some routine forms, you needed

a royal charter.

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