Abstract
This paper develops a simple model to examine the economic consequences of two different criminal market structures in the private protection and extortion industry: (1) horizontal (decentralized) governance and market structure and (2) hierarchical (centralized) governance and market structure with a criminal organization. Forming a criminal organization produces positive or negative effects on its members and social efficiency. These results depend on the potential competitiveness among criminals and the ability of a criminal organization’s boss to target more valuable extortion victims.
| Original language | English |
|---|---|
| Pages (from-to) | 359-375 |
| Number of pages | 17 |
| Journal | European Journal of Law and Economics |
| Volume | 46 |
| Issue number | 3 |
| DOIs | |
| Publication status | Published - 2018 Dec 1 |
Keywords
- Conflict
- Crime
- Extortion
- Organized crime
- Rent-seeking
ASJC Scopus subject areas
- Business and International Management
- Economics and Econometrics
- Law
