Conspiracy among the Many: the Mafia in Legitimate Industries

  • Diego Gambetta
  • Peter Reuter

Abstract

This chapter considers the modes by which the mafia exercises its influence on a number of legitimate industries in both Sicily and the United States. In particular it discusses the kinds of service the mafia provides, the economic consequences of its influence, the conditions that induce the entry of the mafia in specific industries, and the conditions and policies that make it disappear. We share the view that mafia protection in legitimate industries, although occasionally rapacious and unreliable, is frequently neither bogus nor limited to intimidating new entrants. Under some (perhaps most) circumstances, the primary beneficiaries are the owners of the firms being coerced.

Keywords

Depression Rubber Income Assure Expense 

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. Andvig, J. C. and Moene, K. O. (1990) ‘How Corruption May Corrupt’, Journal of Economic Behavior and Organization, 13, pp. 63–76.CrossRefGoogle Scholar
  2. Bell, D. (1960) ‘The Racket-ridden Longshoremen’, in D. Bell (ed.), The End of Ideology (Glencoe, IL: Free Press).Google Scholar
  3. Block, A. (1982) East Side-West Side: Organizing Crime in New York, 1930–1950 (New Brunswick, NJ: Transaction Press).Google Scholar
  4. Chubb, J. (1982) Patronage, Poverty and Power in Southern Italy: A Tale of Two Cities (Cambridge: Cambridge University Press).Google Scholar
  5. Fiorentini, G. (1994) ‘Cartels Run by Criminal Organizations and Market Contestability’. Unpublished paper, Department of Economics, Università di Firenze.Google Scholar
  6. Franchetti, L. [1876] (1974) ‘Condizione politiche ed amministrative della Sicilia’, vol. 1 of L. Franchetti and S. Sonnino (eds), Inchiesta in Sicilia (Firenze: Vallecchi).Google Scholar
  7. Friedman, A. (1988) Agnelli and the Network of Italian Power (London: Mandarin Paperback).Google Scholar
  8. Friedman, J. (1983) Oligopoly Theory (Cambridge: Cambridge University Press).CrossRefGoogle Scholar
  9. Gambetta, D. (ed.) (1988) Trust: Making and Breaking Cooperative Relations (Oxford: Basil Blackwell).Google Scholar
  10. — (1993) The Sicilian Mafia: The Business of Private Protection (Cambridge, MA: Harvard University Press).Google Scholar
  11. Gosch, M. A. and Hammer, R. (1975) The Last Testament of Lucky Luciano (London: Macmillan).Google Scholar
  12. Landesco, J. [1929] (1968) ‘Illinois Crime Survey, Part III’. Reprinted in Organized Crime in Chicago (with introduction by Mark Heller) (Chicago: University of Chicago Press).Google Scholar
  13. New Jersey State Commission of Investigation (1989) ‘Solid Waste Regulation’, Trenton, NJ.Google Scholar
  14. New York Organized Crime Task Force (1988) Corruption and Racketeering in the Construction Industry (New York: ILR Press).Google Scholar
  15. Peltzman, S. (1976) ‘Toward a More General Theory of Economic Regulation’ Journal of Law and Economics, 19, pp. 211–40.CrossRefGoogle Scholar
  16. Reuter, P. (1983) Disorganized Crime: The Economics of the Visible Hand (Cambridge, MA: MIT Press).Google Scholar
  17. — (1987) Racketeering in Legitimate Industries: A Study in the Economics of Intimidation (Santa Monica, CA: Rand Corporation).Google Scholar
  18. — (1993) ‘The Commercial Cartage Industry in New York’, in A. Reiss and M. Tonry (eds), Beyond the Law: Corrupt Organizations, vol. 18 of Crime and Justice: A Review of Research (Chicago: University of Chicago Press).Google Scholar
  19. — Rubinstein, J. and Wynn, S. (1982) Racketeering in Legitimate Industries: Two Case Studies (Washington, DC: National Institute of Justice).Google Scholar
  20. Scherer, F. M. (1970) Industrial Market Structure and Economic Performance (Chicago: Rand-McNally).Google Scholar
  21. Stigler, G. J. (1964) ‘A Theory of Oligopoly’, Journal of Political Economy, 72, pp. 367–83.CrossRefGoogle Scholar
  22. — (1971) ‘The Theory of Economic Regulation’, Bell Journal of Economics and Management Science, 2.Google Scholar

Copyright information

© Cambridge University Press 1995

Authors and Affiliations

  • Diego Gambetta
  • Peter Reuter

There are no affiliations available

Personalised recommendations