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Private Cops on the Fraud Beat: The Limits of American Business Self-Regulation, 1895–1932

Posted: 24 May 2009 Last revised: 11 Feb 2011

Edward Balleisen

Duke University

Date Written: May 19, 2009

Abstract

From the late 1890s through the 1920s, a new set of nonprofit, business-funded organizations spearheaded an American campaign against commercial duplicity. These new organizations shaped the legal terrain of fraud, built massive public-education campaigns, and created a private law-enforcement capacity to rival that of the federal government. Largely born out of a desire among business elites to fend off proposals for extensive regulatory oversight of commercial speech, the antifraud crusade grew into a social movement that was influenced by prevailing ideas about social hygiene and emerging techniques of private governance. This initiative highlighted some enduring strengths of business self-regulation, such as agility in responding to regulatory problems; it also revealed a weakness, which was the tendency to overlook deceptive marketing when practiced by firms that were members of the business establishment.

Keywords: regulation, business organizations

JEL Classification: N82, K2, L5

Suggested Citation

Balleisen, Edward, Private Cops on the Fraud Beat: The Limits of American Business Self-Regulation, 1895–1932 (May 19, 2009). Business History Review, Vol. 83, No. 1, 2009. Available at SSRN: https://ssrn.com/abstract=1407187

Edward Balleisen (Contact Author)

Duke University ( email )

100 Fuqua Drive
Durham, NC 27708-0204
United States

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