Roman Business Associations
Abstract: Roman businessmen could choose between three legal forms for joint business ventures: the societas, the societas publicanorum, and the peculium of a commonly held slave. None of these forms led to larger firms with publicly traded shares. The high level of instability is one of the key explanations: it was difficult under Roman law to commit capital in the long term and finance capital-intensive enterprises. The societas was inevitably liquidated following numerous dissolution events. Members could withdraw their money at any time; their private creditors were not barred from seizing common assets. The peculium was even more unstable: in addition to the dissolution events of the societas, the joint venture came to an end and all items reverted back to the masters if the common slave died. It is true that the societas publicanorum developed into a more stable entity over time. However, during the same period, the business the societas publicanorum was limited to almost disappeared. Why did Roman law fail to provide organizational forms that allowed businessmen to commit capital in the long term? A closer analysis of Roman society suggests that the economic demand for more stable business associations was not great enough to overcome reservations in the social and political setting. This is an important lesson from history, both for the theory of the firm and for the role law plays in it.
