The Effect of Salient Reputational Threats on the Pace of FDA Enforcement

Moshe Maor*, Raanan Sulitzeanu-Kenan

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

69 Scopus citations

Abstract

Do reputational concerns affect the duration of enforcement decisions? We analyze "time to decision" in warning letter processes by two enforcement divisions within the Food and Drug Administration's (FDA) Center for Drug Evaluation and Research. We find that nearly all criticism of these divisions revolves around the FDA's primary consumer protection responsibilities (i.e., underenforcement), thus questioning the validity of the FDA's unique reputation. We also found that as media coverage of the FDA's consumer protection responsibilities becomes more positive, the agency takes enforcement decisions (warning letters) more slowly; in contrast, more critical media coverage leads to quicker action by the FDA. This effect is moderated by media salience; namely, it is found only for periods in which press coverage is relatively intense. An implication of this conditional relationship is an ability to assess the baseline role of reputation in the organization, namely, how concerned it is regarding its reputation in the absence of exogenous challenges.

Original languageAmerican English
Pages (from-to)31-61
Number of pages31
JournalGovernance
Volume26
Issue number1
DOIs
StatePublished - Jan 2013

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