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A perennial issue in corporate law reform is the desirability of a federal system. For notwithstanding the invasive growth of regulation by the national government, principally through the federal securities laws, corporate law is still the domain of the states. While no two corporation codes are identical, there is substantial uniformity across the states. Provisions typically spread in a discernible S-shaped pattern, as one state amends its code in response to another state's innovation. The revision process is often analogized in the academic literature to market competition, in which states compete to provide firms with a product, corporate charters, in order to obtain franchise tax revenues. This characterization is the centerpiece of the federalism debate in corporate law-whether competition, and hence a federal system, benefits shareholders. The hero-or culprit-in the debate is Delaware, the most successful state in the market for corporate charters.

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