THE INSTITUTIONAL INVESTIGATION INCLUDES THE COLLECTION OF INFORMATION THROUGH INTERVIEWS WITH INMATES AND STAFF; THE COMPILATION OF REPORTS, OBSERVATIONS, OPINIONS, ASSESSMENTS, AND OTHER RELEVANT DATA; AND THE PRESENTATION OF A FINAL ASSESSMENT TO THE NATIONAL PAROLE BOARD. STUDY SUBJECTS -- 54 PAROLE OFFICERS AND 132 PAROLEES -- WERE QUESTIONED ABOUT THEIR PERCEPTIONS OF THE REHABILITATIVE VALUE OF THE INVESTIGATION. PAROLEES WHO WERE LIVING WITH PARENTS, FAMILY, RELATIVES, OR WIFE HAD SIGNIFICANTLY MORE FAVORABLE PERCEPTIONS OF THE INSTITUTIONAL INVESTIGATION THAN DID PAROLEES LIVING IN A HALFWAY HOUSE. ONLY PAROLEES LIVING WITH PARENTS, FAMILY, RELATIVES, OR WIFE PERCEIVED THE INVESTIGATION AS FAVORABLY AS DID PAROLE OFFICERS. THESE FINDINGS SUPPORT THE FORMATION-OF-SUBCULTURES AND DISSONANCE THEORIES. PAROLEES IN HALFWAY HOUSES INTERACT MORE WITH EACH OTHER THAN WITH THEIR PAROLE OFFICERS AND TEND TO CONFORM MORE TO THE NORMS OF THE PAROLEE SUBCULTURE. PAROLEES WHO LIVE WITH THEIR FAMILIES INTERACT MORE WITH THEIR PAROLE OFFICERS, EITHER DIRECTLY OR THROUGH MEMBERS OF THE FAMILY. THERE WERE NO SIGNIFICANT DIFFERENCES IN PERCEPTIONS BETWEEN PAROLEES LIVING ALONE AND THOSE LIVING IN A HALFWAY HOUSE OR WITH FAMILY. LIVING ALONE MAY CAUSE THE PAROLEE TO CONSIDER HIMSELF OUTSIDE OF THE SYSTEM AND TO AVOID THE COERCIVE OR SANCTIONING POWERS OF THE PAROLE OFFICER. SUPPORTING DATA AND A LIST OF REFERENCES ARE INCLUDED. (LKM)