Document Type
Article
Publication Date
2018
Abstract
2018 marks the 60th anniversary of the publication of Franco Modigliani and Merton Miller’s The Cost of Capital, Corporation Finance, and the Theory of Investment. Widely hailed as the foundation of modern finance, their article, which purports to demonstrate that a firm’s value is independent of its capital structure, is little known by lawyers, including legal academics. That is unfortunate because the Modigliani-Miller capital structure irrelevancy proposition (when inverted) provides a framework that can be extremely useful to legal academics, practicing attorneys and judges.
Keywords
Law and financial economics, economic theory, corporate finance, arbitrage, debt, equity, leverage, Modigiliani-Miller, reverse M&MI, legal practice and education, deals, transactions
Publication Title
Yale Journal of Regulation Bulletin
Repository Citation
Knoll, Michael S., "The Modigliani-Miller Theorem at 60: The Long-Overlooked Legal Applications of Finance’s Foundational Theorem" (2018). All Faculty Scholarship. 1936.
https://scholarship.law.upenn.edu/faculty_scholarship/1936
Included in
Business Organizations Law Commons, Corporate Finance Commons, Courts Commons, Economic Theory Commons, Finance Commons, Intellectual History Commons, Law and Economics Commons, Legal Education Commons, Legal Profession Commons
Publication Citation
35 Yale J. Reg. Bull. 1 (2018)