Mullin, Wallace P.; Snyder, Christopher M. --- "Corporate Crime" [2009] ELECD 462; in Garoupa, Nuno (ed), "Criminal Law and Economics" (Edward Elgar Publishing, 2009)

Book Title: Criminal Law and Economics

Editor(s): Garoupa, Nuno

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781847202758

Section: Chapter 9

Section Title: Corporate Crime

Author(s): Mullin, Wallace P.; Snyder, Christopher M.

Number of pages: 37

Extract:

9 Corporate crime
Wallace P. Mullin and Christopher M. Snyder* 1




1. Introduction
The law and economics literature usually categorized under the heading
of corporate crime is actually broader than this (already quite broad)
heading. The literature goes beyond crimes (commission of willful illegal
acts) to study corporate torts (accidental harms) as well. It is appropriate
to study torts as well as crimes because the categorization of acts into torts
or crimes is not pre-ordained but is a public-policy choice, which can be
informed by economic analysis. The literature is also broader in another
way, studying crimes committed not just by incorporated enterprises
but by a broad range of business enterprises including closely held firms,
non-profit institutions, and government agencies. Many of the economic
principles derived in the literature are general enough to apply equally to
these different types of enterprise.
Consistent with the broad approach of the literature, then, this chapter
will discuss crimes and torts committed by legal enterprises. An enterprise
is distinct from an individual (and thus corporate crime is distinct from
`ordinary' crime), in that an enterprise is a hierarchical group of individu-
als, with low-level employees acting under the direction of a manager (or
possibly a tier of managers) who in turn works for the firm's directors and
owners. The fundamental issue analyzed by law and economics scholars
has been the appropriate level of the hierarchy to target with sanctions
in order to deter crime most efficiently. Should sanctions target ...