A theory of organized crime, corruption and economic growth

Rana, MP ORCID: 0000-0003-3498-9673, Blackbourn, K and Neanidis, KC 2017, 'A theory of organized crime, corruption and economic growth' , Economic Theory Bulletin, 5 (2) , pp. 227-245.

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Abstract

We develop a framework for studying the interactions between organized crime and corruption, together with the individual and combined effects of these phenomena on economic growth. Criminal organizations co-exist with law-abiding productive agents and potentially corrupt law enforcers. The crime syndicate obstructs the economic activities of agents through extortion, and may pay bribes to law enforcers in return for their compliance in this. We show how organized crime has a negative effect on growth, and how this effect may be either enhanced or mitigated in the presence of corruption. The outcome depends critically on a trade-off generated when corruption exists, that between a lower supply of crimes and the probability these crimes are more likely to be successful.

Item Type: Article
Schools: Schools > Salford Business School
Journal or Publication Title: Economic Theory Bulletin
Publisher: Springer International Publishing
ISSN: 2196-1085
Related URLs:
Depositing User: MP Rana
Date Deposited: 19 Jan 2018 11:49
Last Modified: 28 Nov 2018 18:32
URI: http://usir.salford.ac.uk/id/eprint/45006

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