Much Ado About Nothing: The Limitation of Liability and the Market for 19th century Irish Bank Stock

John Turner; Charles Hickson; C. McCann

doi:10.1016/j.eeh.2004.11.002

Much Ado About Nothing: The Limitation of Liability and the Market for 19th century Irish Bank Stock

John Turner, Charles Hickson, C. McCann

Research output: Contribution to journal › Article › peer-review

18 Citations (Scopus)

Abstract

Abstract Limited liability is widely believed to be a prerequisite for the emergence of an active and liquid securities market because the transactions costs associated with trading ownership of unlimited liability firms are viewed as prohibitive. In this article, we examine the trading of shares in an Irish bank, which limited its liability in 1883. Using this bank’s archives, we assemble a time series of trading data, which we test for structural breaks. Our results suggest that the move to limited liability had a negligible impact upon the trading of this bank’s shares.

Original language	English
Pages (from-to)	459-476
Number of pages	18
Journal	Explorations in Economic History
Volume	42 (3)
Issue number	3
DOIs	https://doi.org/10.1016/j.eeh.2004.11.002
Publication status	Published - Jul 2005

ASJC Scopus subject areas

Economics and Econometrics

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10.1016/j.eeh.2004.11.002

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abstract = "Abstract Limited liability is widely believed to be a prerequisite for the emergence of an active and liquid securities market because the transactions costs associated with trading ownership of unlimited liability firms are viewed as prohibitive. In this article, we examine the trading of shares in an Irish bank, which limited its liability in 1883. Using this bank{\textquoteright}s archives, we assemble a time series of trading data, which we test for structural breaks. Our results suggest that the move to limited liability had a negligible impact upon the trading of this bank{\textquoteright}s shares.",

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