NCJ Number
144205
Journal
Canadian Journal of Criminology Volume: 35 Issue: 3 Dated: (July 1993) Pages: 293-308
Date Published
1993
Length
16 pages
Annotation
While quantitative research conducted to examine correlates of corporate crime has tended to use multiple regression techniques employing single indicator variables, the author argues that a multiple indicator latent variable approach may more accurately represent dimensions of corporate financial performance and illegality.
Abstract
Research was conducted using data provided by the University Consortium for Political and Social Research on 461 large, publicly owned manufacturing firms in the United States. The study recorded Federal administrative, civil, and criminal actions either initiated or completed by 25 Federal agencies in 1975 and 1976. Two exogenous financial performance variables were constructed representing firm and industry performance, and one endogenous latent illegality variable was constructed. Findings demonstrated a negative relationship between the two latent variables representing financial performance and the latent variable representing corporate illegality. It was determined that strain theory may be an appropriate explanation for some types of corporate crime; that is, financial strain represented by chronically poor financial performance at the firm or industry level may be seen as a first step toward corporate crime as companies attempt to escape their adverse situations. 35 references, 1 note, and 2 figures