Corporate Securities Fraud: Insights from a New Empirical Framework

Journal of Law, Economics, and Organization, Forthcoming

43 Pages Posted: 6 Jul 2004 Last revised: 2 Apr 2011

Tracy Yue Wang

University of Minnesota - Twin Cities - Carlson School of Management

Date Written: November 1, 2010

Abstract

Empirical analysis of corporate fraud faces a challenge because the commission of fraud is not directly observable. We observe only detected frauds. In this paper I introduce a new empirical model to address this partial observability of fraud. The new model generates new insights about not only the determinants of fraud commission and fraud detection, but also the interaction between the two latent processes. I also show that the empirical models used in the existing literature can lead to incorrect assessment of corporate or public policies designed to combat fraud.

Keywords: securities fraud, fraud detection

JEL Classification: G30

Suggested Citation

Wang, Tracy Yue, Corporate Securities Fraud: Insights from a New Empirical Framework (November 1, 2010). Journal of Law, Economics, and Organization, Forthcoming. Available at SSRN: https://ssrn.com/abstract=561425

Tracy Yue Wang (Contact Author)

University of Minnesota - Twin Cities - Carlson School of Management ( email )

19th Avenue South
Minneapolis, MN 55455
United States

Paper statistics

Downloads
844
Rank
21,637
Abstract Views
2,964