The Decomposition of Antitrust: Testing a Multi-Level, Longitudinal Model of Profit-Squeeze

Abstract

The idea that certain types of corporate crime are caused by a squeeze on firm profits is a common theme in the current criminological literature. This paper, drawn from a study of 52 survivor firms over 55 years of economic and criminal activity, extends this literature in several ways. First, the sources of firm profit-squeeze are expanded beyond the traditional categories of firm and industry to include macro economic influences. Second, a longitudinal design allows the estimation of changes in the extent and nature of corporate crime as a function of economic and structural changes over time. Third, the typically broad corporate crime typologies which are used to categorize illegal activities are eschewed in favor of greater conceptual and empirical refinement. Antitrust crime is decomposed into specific crime types and predicted by a multilevel economic model of profit-squeeze. The findings suggest that only certain forms of antitrust criminality are related to profit-squeeze; others occur within a munificent environment while some are unrelated to economic conditions. The implications of these findings are discussed as well as directions for future research.