Internal control technologies within industrial organizations

Previous studies of industrial organizations have examined the effects of formal monitoring controls on employee-performance. The present study extends existing research by analyzing the firm's ability to rely upon alternative internal control strategies and by including opportunities for employee-collusion. In particular, we model formal and informal monitoring activities and investigate their combined effect upon employees' incentives to collude. Additionally, a sensitivity analysis is performed to determine the relative efficiencies of various types of internal controls.