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This article reports on the first quantitative perceptual deterrence study of corporate (rather than individual) deterrence. The study is based on interviews with 410 chief executives of small organizations and their officially recorded compliance with regulatory standards. We find partial support for the certainty of detection as a predictor of both self-reported and officially recorded compliance but no support for the certainty or severity of sanctioning. The narrow range of sanctions available in the particular regulatory domain studied (regulation of nursing home quality) has enabled a fuller specification than was possible in previous studies of an expected utility model for all available sanctions. Managers' expected corporate disutility from all sanctions fails to explain compliance. Deterrence does not work significantly more effectively for chief executives (a) of for-profit versus nonprofit organizations, (b) who are owners compared with those who are not owners, (c) who say they think about sanctions more (sanction salience), (d) who may better fit the rational choice model in that they are low on emotionality, (e) who have a weaker belief in the law. Nor is deterrence more effective when compliance costs are low.

Australian nursing home inspection teams are partitioned into those with an enforcement ideology supportive of reintegrative shaming, those who believe in being tolerant and understanding when confronted with noncompliance with the law, and those with a more stigmatizing ideology toward noncompliers. Nursing homes visited by teams with a reintegrative shaming ideology display significantly improved compliance in the period following the inspection. Nursing homes visited by * We would also like to thank Bruce Biddle for his comments on an earlier draft. CRIMINOLOGY VOLUME 32 NUMBER 3 1994 361 362 MAKKAI AND BRAITHWAITEit was a way of attempting to salvage and contextualize the explanatory power of a number of long-standing theoretical traditions, none of which enjoyed consistent empirical confirmation in the literature or widespread support from criminologists, but all of which had some claim to a degree of empirical support. These theoretical traditions were labeling theory (e.g., Becker, 1963), subcultural theory (e.g., Cohen, 1955), opportunity or strain theory (e.g., Cloward and Ohlin, 1960; Merton, 1968); control theory (Hirschi, 1969); differential association (Sutherland and Cressey, 1978), and social learning theory (e.g., Akers et al., 1979).The key idea of reintegrative shaming is to partition shaming into two types (actually, a continuum with two poles) whereby shaming that is reintegrative forms one end of the continuum and shaming that is stigmatizing forms the other. Thus when shaming is more reintegrative, the explanatory framework of control theory works (reducing crime). When shaming is stigmatizing, however, the explanatory frameworks of labeling and subcultural theory come into play (increasing crime). Frameworks that were viewed previously as fundamentally incompatible (Hirschi, 1979) are synthesized through the simple device of the partitioning of shaming. So what is the difference between reintegrative shaming and stigmatization?Reintegrative shaming involves the following: Disapproval while sustaining a relationship of respect; Ceremonies to certify deviance terminated by ceremonies to decertify deviance; Disapproval of the evil of the deed without labeling the person as evil; and Not allowing deviance to become a master status trait.Disrespectful disapproval, humiliation; Ceremonies to certify deviance not terminated by ceremonies to decertify deviance; Labeling the person, not only the deed, as evil; and Allowing deviance to become a master status trait. Stigmatization involvesShaming, according to the theory, is more likely to be reintegrative and more likely to be effective in conditions of high interdependency between the disapprover and the disapproved. A variety of individual and structural characteristics were posited as conducive to interdependency. Thus constructed, the theory was able to account for many of the things known about the patterning of crime-why women should be a low-crime group, why the young and the unemployed should be high-crime groups, why marriage should reduce ...

Using Kagan and Scholz (1984) typology of regulatory noncompliance, this study examined the perceptions of regulators and of regulatees toward the regulatory encounter to predict subsequent compliance with nursing home quality of care standards. Appraisals of both regulators and regulatees were not driven by motivational analyses of each other's actions, but rather by assessments of performance and social group identity. The regulators saw nursing homes in terms of one evaluative dimension ranging from responsible and not in need of intervention through to irresponsible and needing intervention. The corresponding reactions of nursing home managers involved seeing the regulators as cooperative and sympathetic through to police‐like and coercive. On both sides of the regulatory encounter, criticism and reactions to criticism swamped nuanced analyses of motivational underpinnings and rational decision models in explaining compliance. The motivational complexity underlying the Kagan and Scholz typology was, however, apparent in the self‐reported motivational postures of managers toward the regulatory process. The postures of managerial accommodation and capture to the regulatory culture were associated with compliance. Over time, resisters to the new regulatory regime became more compliant, particularly those whom inspectors judged as best left alone to adjust. In contrast were managers whose response to the regulatory process was disengagement. Their organizations experienced deterioration in compliance. The study fails to find that certain kinds of regulatory strategies such as deterrence, education and persuasion work better than others across the sample or with specific groups. Extant models focus excessively on how to play the regulatory game without recognizing the potential for players dropping out of the game. Understanding reasons for disengagement and processes for reengagement are fundamental to the application of behavioral decision theory models to the regulatory context.

When regulatory inspectors trust industry, is this trust abused in a way that reduces regulatory compliance? Or does trust foster the internalization of regulatory objectives by regulated managers? Does trust build goodwill that translates into improved voluntary compliance? Data on compliance by Australian nursing homes with quality of care standards supports the latter interpretation. Nursing homes experience improved compliance after regulatory encounters in which facility managers believe that they have been treated as trustworthy. This finding commends a dynamic regulatory strategy of dialogue and trust as a first choice followed by escalation to more punitive regulation when trust is abused. Responsive versus static regulatory strategies and communitarian versus hierarchical fiduciary conceptions of guardianship are advanced as implications for resolving the dilemmas of trust and compliance.