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DRPS : Course Catalogue : School of Law : Law

Undergraduate Course: Economic analysis of corporate finance law (LAWS10153)

Course Outline
SchoolSchool of Law CollegeCollege of Arts, Humanities and Social Sciences
Credit level (Normal year taken)SCQF Level 10 (Year 3 Undergraduate) AvailabilityAvailable to all students
SCQF Credits20 ECTS Credits10
SummaryThis course aims to examine fundamental concepts and theories concerning corporate financing and investing decisions. It is an in-depth study of some aspects of corporate law and corporate finance. Some seminars have a strong theoretical focus and engage in detail with various theories explaining the interactions between various corporate constituencies. At the same time, the course as a whole has very significant practical relevance.
Course description Topics covered include:

First part:
1. An introduction to corporation law and economics (including theories of the firm)
2. Limited liability and shareholders' voting rights
3. Dividend policy and agency costs

Second part:
4. Nature and organisation of securities and derivatives markets
5. Introduction to the economic theories underpinning capital markets
6. Issuer disclosure and market transparency
7. Capital raising: IPOs and private equity
8. Capital raising: Crowdfunding and ICOs
9. Legal and economic analysis of market abuse
10. The market for corporate control

Entry Requirements (not applicable to Visiting Students)
Pre-requisites Students MUST have passed: ( Business Entities (LAWS08134) OR Business Entities (LAWS08099))
Prohibited Combinations Other requirements None
Information for Visiting Students
High Demand Course? Yes
Course Delivery Information
Not being delivered
Learning Outcomes
On completion of this course, the student will be able to:
  1. Demonstrate a critical understanding of the main economic theories of the corporation and their implications on corporate finance.
  2. Compare and contrast the legal and economic approaches to fiduciary duties and the business judgement rule.
  3. Analyse the main economic functions of capital markets and of capital market instruments.
  4. Demonstrate a critical understanding of the main economic theories relating to the operation of capital markets and prohibition of market abuse.
  5. Be able to analyse critically primary and secondary source materials and use them to present a logical and well-structured oral or written argument.
Reading List
The following titles offer background information on company law:

Reiner Kraakman et al., The Anatomy of Corporate Law, 2nd ed. (New York: Oxford University Press, 2009), chapters 3-6

John Lowry and Arad Reisenberg, Pettet's Company Law: Company Law and Corporate Finance, 4th ed. (Essex: Pearson, 2012), chapters 7 - 11

Specific materials and resources for each class will be indicated in the course handouts which will be made available on a weekly basis in advance of each class.
Additional Information
Graduate Attributes and Skills By the end of the course the students will:

1) develop their ability to work independently under fixed deadlines, seeking relevant advice and support when necessary

2) develop their ability to work constructively as a member of a group or team, assert leadership or follow instructions

3) participate effectively in seminars, workshops and discussions

4) develop their capacity of reflecting on the outcomes of individual research efforts with a view to identifying strengths and weaknesses and furthering their own learning
KeywordsTheory of the Firm; Shareholder Primacy; Stakeholders; Fiduciary Duties; Market for Coporate Control
Course organiserDr Longjie Lu
Tel: (0131 6)50 2336
Course secretary Angie Jones
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