On Corporate Law Federalism: Threatening the Thaumatrope.

This article notes an overlooked advantage of state as opposed to federal regulation of corporate governance--the ability of state law to alternate between lax and stringent regulation, shifting between hard-edged rules and fuzzy standards and between strong and weak interpretations of fiduciary constraints. The authors refer to this back-and-forth regulatory methodology as "thaumatrope analytics" and argue that it has significant advantages over the federal method of inflexible governance mandates. Increased federalization of corporate law risks losing the value of the subtle state regulatory methodology to the potential disadvantage of business corporations and the economy of which they are a part. [ABSTRACT FROM AUTHOR]