Lecture14 Econ 327 - 1 Not all businesses lend themselves...

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Unformatted text preview: 1 Not all businesses lend themselves to centralized organization; some do, and these may provide the nucleus of capital and entrepreneurial talent for extension into other business that would not, alone, support or give rise to a monopoly or cartel. Do a few core criminal markets provide the organizational stimulus for organized crime? Schelling Organized Criminal Enterprises: Organized Criminal Enterprises: Definitions Definitions Economic: Large-scale continuing firms with the internal organization of a large enterprise which make the conscious decision to control or monopolize the market. Strong incentives to collude: Price control Economies of scale Decreased risk Decreased competition Organized Criminal Enterprises Organized Criminal Enterprises Legal: Includes elements of conspiracy Mississippi: two or more personsconspiringprofit Kansas: continuing criminal conspiracy organized for power and profit, utilizing fear and corruption to obtain immunity from the law. Pennsylvania: conspiracy to commit murder, bribery or extortion, narcotics violation, prostitution, usury, subornation of perjury, illegal gambling Dept. of Justice: larger enterprises affecting interstate commerce--Extortion--murder--bribery--fraud--narcotics trafficking--labor racketeering La Cosa Nostra, Sicilian Mafia, Chinese Triads, Russian criminal organizations Caribbean gangs South American gangs Organized Criminal Enterprises Organized Criminal Enterprises General Organizational Attributes: Corruption Violence Sophistication Continuity Structure Discipline Multiple Enterprises Involvement with Legitimate Enterprises Bonding Rituals Organized Criminal Enterprises Organized Criminal Enterprises Activities: Extortion Prostitution Gambling Loan-sharking/Usury Smuggling Contraband Union Racketeering Narcotics Sale Robbery/Burglary Confidence Games Capital Lenders Services Brokers Legitimate Businesses Money Laundering Organized Criminal Enterprises Organized Criminal Enterprises Peculiar Threat: Unique Capacity for Extortion and Intimidation: Cartelization $ D D Q Recruitment 8 Racketeering and the provision of illegal goods (like gambling) have been conspicuously neglected by economistsYet a good many economic and business principles that operate in the upperworld must, with suitable modification for change in environment, operate in the underworld as welljust as a good many economic principles that operate in an advanced competitive economy operate as well in a sot or a primitive economy. Since one of the interesting questions is why some underworld business becomes organized and some not, and another, what kinds of organizations should be expected, a classification of these enterprises has to cover more than just organized crime and to distinguish type of...
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Lecture14 Econ 327 - 1 Not all businesses lend themselves...

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