A Microeconomic Model of Opportunistic Financial Crimes: Prosecutorial Strategy When Firms Are Too Big To Jail

This research paper examines the challenges faced by prosecutors when dealing with corporate financial crimes, particularly when firms are deemed "Too Big To Jail" (TBTJ). It develops a new microeconomic model to analyze prosecutorial strategies in such scenarios. The paper argues that the TBTJ problem can reduce the deterrent effect of policies relying on large corporate fines. Furthermore, it suggests that TBTJ firms may not be incentivized to invest in internal controls and could even subsidize employee criminal activity. The research proposes that to counteract this, prosecutors should shift focus towards prosecuting individual managers, thereby increasing their personal risk for dishonest dealings.

Curriculum

This program is a research paper that presents a novel microeconomic model of corporate criminal liability.

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   • A Microeconomic Model of Opportunistic Financial Crimes: Prosecutorial Strategy When Firms Are Too Big To JailN/A