Let's make an example: a group of people want to play football and have to rent a field. If they know each other very well, they could pool money and entrust one of them to rent the field. Activities like this are very common, but usually one-off and easily "audited" by the others.
If this activity is on a recurring basis though, or if there are new people joining, this way of doing things quickly becomes very awkward. What recourse have the group members if that person doesn't act on their task, or makes a deal with the owner of the field and pockets the difference, or uses the cash to bridge over cashflow holes in their personal finances? Or if they simply become incommunicado, or even die? The problems become even more severe when activities like festivals are organized, where the organizer would have to assume additional responsibilites. These problems would discourage any nontrivial economic activity.
Similar arguments can be made for other economic activities where unlimited and exclusive personal responsibility would be awkward. It's probably possible to regulate many aspects of such activities using contracts. But by doing that, something very similar to a corporation would be created. Of course, these days nobody does it this way. Most countries have very well developed laws that simplify these affairs.
If this activity is on a recurring basis though, or if there are new people joining, this way of doing things quickly becomes very awkward. What recourse have the group members if that person doesn't act on their task, or makes a deal with the owner of the field and pockets the difference, or uses the cash to bridge over cashflow holes in their personal finances? Or if they simply become incommunicado, or even die? The problems become even more severe when activities like festivals are organized, where the organizer would have to assume additional responsibilites. These problems would discourage any nontrivial economic activity.
Similar arguments can be made for other economic activities where unlimited and exclusive personal responsibility would be awkward. It's probably possible to regulate many aspects of such activities using contracts. But by doing that, something very similar to a corporation would be created. Of course, these days nobody does it this way. Most countries have very well developed laws that simplify these affairs.