Growth in per capita income for the developed countries of Japan, the United States and the European Community comes primarily from increased knowledge -- improved skills and innovation in the form of improved products and processes -- not from capital deepening. For innovative ideas to make their contribution, however, new investment is generally required. The most promising new investment project proposals in an economy are likely to be innovation based, because, if they are not, the potential for above normal returns is likely to have already been competed away by other firms making similar investments. Thus, the better an economy is at allocating its scarce savings to implementing the most promising proposed investment projects, the higher the level of innovation. Business law (corporate, securities and contract law) helps shape the institutions that make the decisions that determine which of an economy’s investment project proposals get implemented and which do not. By affecting the ability of an economy to choose the best proposed investment projects, business law can affect the level of innovation and hence the rate of improvement in a country’s economic welfare.
Neither scholars nor policymakers have given this link between law and innovation sufficient attention. Theory is underdeveloped and what exists is under informed by actual experience. Japan, the United States and the European Community each has a rich history of both successes and failures in identifying and implementing highly promising, innovative investment projects. The lessons of the history of each economy, however, are insufficiently understood by its own scholars and even less well understood by scholars from the other two economies. In order to remedy these deficits, the project in business law and innovation will gather the best scholars in the world working at the intersection of law, the economics of contracts and organization, finance and innovation. The papers contributed by these scholars will seek to account for what has happened across three economies with significantly different institutional characteristics. The theory of innovation will be deepened by this better understanding of what works and what does not under various circumstances and why, as well as of the tradeoffs involved. The ultimate goal would be for policymakers in Japan, the United States and the European Community to be able to refine their legal systems in ways that will promote welfare enhancing innovation, based on a better understanding both of what has happened in their own economy and of what has happened in each of the other two.
This project includes a planning session, which has already occurred, a conference in New York at which preliminary drafts of the papers are discussed, and two follow up conferences, respectively in Amsterdam and Tokyo, where final papers will be presented and further input from European and Japanese commentators and participants received. The result will be a coordinated set of papers in a book published by a major university press.
Business Law and Innovation Conference - May 14-15, 2009 - Amsterdam
The Amsterdam meeting was sponsored by the Duisenberg School of Finance.
Once again, this project includes a planning session, which has already occurred, a conference in New York (10/31-11/1/08) at which preliminary drafts of the papers were discussed and two follow up conferences, respectively (this being the second in the project series) in Amsterdam and a concluding conference meeting in Tokyo, where final papers will be presented and further input from European and Japanese commentators and participants received. The result will be a coordinated set of papers in a book published by a major university press.
NOTE: Below is the protected link to conference papers and presentations. Conference was by invitation only.
VENUE
Hitotsubashi University, Graduate School of International Corporate Strategy
National Center of Sciences
2-1-2 Hitotsubashi, Chiyoda-ku, Tokyo
Phone: 81-(0)3-4212-3148
ORGANIZERS
Aoki, Reiko, Hitotsubashi University
Fox, Merritt B., Columbia Law School
McCahery, Joseph A., Tilburg University
Miyajima Hideaki, Waseda University, RIETI
Nagaoka Sadao, Hitotsubashi University, RIETI
Shishido Zenichi, Hitotsubashi University,RIETI
Scott, Robert E., Columbia Law School
Friday, October 30th
10:00 - 10:10 Opening Remarks: RIETI or Organizer
10:10 - 12:10 Finance I: Innovation and Capital Markets
“Promoting Innovation: The Law of Publicly Traded Corporations” Merritt B. Fox, Columbia Law School
Discussant – Atsushi Koide, Gakushuin University, Law School
“Behind the Scenes: The Corporate Governance Preferences of Institutional
Investors” Joseph A. McCahery, Tilburg University, Tilburg Law School and
Duisenberg School of Finance,
(with Zacharias Sautner and Laura T. Starks)
Discussant – Takuji Saitoh, School of Economics, Kyoto Sangyo University
12:10 - 1:40 Lunch
1:40 - 3:40 Contracts I: Contracting for Collaborative Innovation from Japanese
Perspectives
“Ownership of collaborative research” Sadao Nagaoka, Hitotsbubashi University, Research Institute for
Innovation, and RIETI
Discussant – Sharon Belenzon, Fuqua School of Business, Duke University
“Collective Rights Organizations and Upstream R & D Investment” Reiko Aoki, Hitotsbubashi University, Institute for Economic Research
Discussant - Arnoud W.A. Boot, University of Amsterdam, Amsterdam
Center for Law & Economics (ACLE)
3:40 -4:00 Coffee Break
3:40-6:00 Finance II: Private Financing and Innovation
“Market Liquidity, Investor Participation and Managerial Autonomy:
Why Do firms go Private” Arnoud W.A. Boot, University of Amsterdam, Amsterdam Center for Law
& Economics (ACLE),
(with Radhakrishnan Gopalan, and Anjon Thakor)
Discussant – Shinichi Hirota, Waseda University, Graduate School of
Commerce
“Locating Innovation: The Endogeneity of Technology, Organizational
Structure and Financial Contracting” Ronald J. Gilson, Columbia Law School and Stanford Law School
Discussant – Michael Korver, Hitotsubashi University, International
Corporate Strategy
6:30 Reception
Saturday, October 31st
10:00 – 12:00 Finance III: Governance and Innovation
“Intracompany Governance and Innovation” Sharon Belenzon, Fuqua School of Business, Duke University,
(with Patrick Bolton and Tomer Berkovitz)
Discussant – Hideshi Itoh, Hitotsubashi University, Graduate School of
Commerce
“Braiding: The Interaction of Formal and Informal Contracting in Theory,
Practice and Doctrine” Ronald J. Gilson, Columbia Law School and Stanford Law School,
(with Robert E. Scott and Charles F. Sabel)
Discussant – Noriyuki Yanagawa, University of Tokyo, Faculty of
Economics
12:00 - 1:30 Lunch
1:30 - 3:00 Contracts II: Contracting Mechanisms and Private Enforcement
“Satisfying Contracts” Patrick Bolton, Columbia Graduate School of Business,
(with Antoine Faure-Grimaud)
Discussant – Hiroshi Osano, Kyoto University, Institute of Economic
Research
“Equity Markets and Institutions: The case of Japan” Hideaki Miyajima, Waseda University, RIETI and WIAS,
(with Julian Franks and Colin Mayer)
Discussant – Patrick Bolton, Columbia Graduate School of Business
3:30 - 3:50 Coffee Break
3:50 - 6:00 Finance IV: Innovation, Finance and Governance Structure in Japan
“Why Japanese Entrepreneurs Don’t Give Up Control to Venture
Capitalists” Zenichi Shishido, Hitotsubashi University, International Corporate
Strategy, and RIETI
Discussant – Merritt B. Fox, Columbia Law School
“Innovation and the Regulation of the Capital Markets in Japan” Sadakazu Osaki, University of Tokyo Law School, Nomura Research
Institute
“Venture Capital Financing In Japan” (TBA) Hajime Tanahashi, Mori Hamada & Matsumoto,
Discussant – Joseph A. McCahery, Tilburg University, Tilburg Law School
and Duisenberg School of Finance
5:50 - 6:00 Concluding Remarks: Organizer
6:30 - 8:30 Dinner
NOTE: Below is the protected link to all conference papers and presentations. Conference was by invitation only.
The result will be a coordinated set of papers in a book published by a major university press.
Growth in per capita income for the developed countries of Japan, the United States and the European Community comes primarily from increased knowledge -- improved skills and innovation in the form of improved products and processes -- not from capital deepening. For innovative ideas to make their contribution, however, new investment is generally required. The most promising new investment project proposals in an economy are likely to be innovation based, because, if they are not, the potential for above normal returns is likely to have already been competed away by other firms making similar investments. Thus, the better an economy is at allocating its scarce savings to implementing the most promising proposed investment projects, the higher the level of innovation. Business law (corporate, securities and contract law) helps shape the institutions that make the decisions that determine which of an economy’s investment project proposals get implemented and which do not. By affecting the ability of an economy to choose the best proposed investment projects, business law can affect the level of innovation and hence the rate of improvement in a country’s economic welfare. 
