Discriminant analysis of the FTC's informational remedies



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Texas Tech University


Previous research of the Federal Trade Commission's (FTC) informational remedies, including affirmative disclosures and corrective advertising, has neglected to account for outside factors that may influence the remedies. Weingast and Moran's (1983) study found that liberal congressmen in the relevant subcommittees influenced case selection at the FTC. This study, a content analysis of FTC decisions, extended the research by examining whether the subcommittees influenced informational remedies ordered by the FTC. In addition, this study examined whether economic and temporal factors influenced the use of informational remedies.

Discriminant analysis was employed as the statistical technique. Discriminant analysis was used because it creates an equation that allows the researcher to form a predictive model. Two discriminant analyses were performed. The first examined the simple use of an informational remedy, and the second examined the use of informatic remedies in which specific statements were ordered.

The findings showed (a) a positive relationship between the Senate appropriati subcommittee and the use of informational remedies, and (b) a positive relationship between the Senate appropriations chairperson and informational remedies of a specil statement. The functions created by this relationship performed poorly, however, thu precluding the formation of reliable models. The results of this study suggested that economic and temporal factors failed to influence informational remedies and that perhaps congressional influence was not as pervasive as previous research suggested.



United States, Trade regulation, Discriminant analysis