Joint-Stock Companies.

The authority of most of the early English colonies derived from legal devices that gave the colony standing in English law. Early colonies such as Virginia and Massachusetts Bay were issued charters by the king of England. These charters were initially given to a group of investors, usually no more than twenty in number, to form a joint-stock company, which enabled them to pool their money. In addition, a charter typically named the new corporation, specified its organization, granted specific economic advantages, and granted land and governing powers if the company was to run a colony.

Virginia and Massachusetts.

Under such a charter, the Virginia Company of London owned and administered the colony at Jamestown for seventeen years. The charter was revoked in 1624, and Virginia became a royal colony, allowing the monarchy greater control over the province. The charter...