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The real effects of 'ndrangheta: firm-level evidence

Litterio Mirenda (), Sauro Mocetti () and Lucia Rizzica ()

No 1235, Temi di discussione (Economic working papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: We analyze the real effects of mafia infiltrations in the legal economy. We focus on the case of the 'ndrangheta, a large criminal organization originating from the South of Italy. Combining information from investigative records with panel data on firms' governance and balance sheets, we build an indicator of 'ndrangheta infiltrations in firms located in areas with no tradition of mafia settlements. We show that (i) organized crime targets firms in financial distress and privileges sectors that most rely on public sector demand or are more money laundering prone;; (ii) infiltrations generate a significant rise in the firm's revenues; (iii) the penetration of mafia produces a long-run negative effect on economic growth at the local level.

Keywords: organized crime; firm performance; competition (search for similar items in EconPapers)
JEL-codes: D02 K42 L11 (search for similar items in EconPapers)
Date: 2019-10
New Economics Papers: this item is included in nep-bec and nep-law
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Persistent link: https://EconPapers.repec.org/RePEc:bdi:wptemi:td_1235_19

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