One of the key features of corporations and the Gilded Age in general was an increasing concentration of power in large entities. Business and government became bigger while their respective operations became intertwined. Ever since the federal government had used its power and money to encourage businessmen to build railroads, all levels of government had become more involved in the nation's economic welfare. State law treated the corporation as an individual. Unlike a partnership, in which liability ran high for individual investors, the corporation involved limited liability .
Limited liability makes individual investors legally liable only for their share of the investment.
In partnerships, if a partner skips town or dies, the other partners are liable for any outstanding debts. In corporations, if an individual investor dies no other investors are affected. If the corporation goes bankrupt, the investors are only required to foot the bill for a percentage corresponding to the proportion of their investment. As corporations became more common in the mid-19th century, the opportunity for wide numbers of people to invest in business greatly expanded, for individual investors could now invest without the fear of total liability. Individual investors may come and go, but the corporation has an indefinite lifespan.