Monday 12
A8 - Illegal behavior, Corruption & Crime
Chair: Rafael Ribas
› 11:30 - 11:55 (25min)
› Room 103 - B. Martinu
"Mafia Inc.": When Godfathers Become Entrepreneurs
Giuseppe Sorrenti  1@  , Marco Le Moglie  2@  
1 : University of Zürich  (UZH)
Winterthurerstrasse 190, CH-8057, Zürich -  Switzerland
2 : Bocconi University

Although criminal organizations are usually responsible for the deterioration of local
economic conditions, they are capable to attract considerable social consensus espe-
cially in a context of weak institutional presence. We study one of the main channels
used by organized crime to obtain empowerment and territorial control, namely the
investment in the legal economy. We focus on the case of Italy, a country historically
plagued by a conspicuous presence of mafia-type organizations, and we disentangle
for the first time the disruption effect - worsening local economic prosperity - from
the entrepreneurial effect - allowing for money laundering and engendering silent
social consensus. Our results highlight a strong and sizable investment of organized
crime in the legal economy.

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