Resisting to the Extortion Racket: an Empirical Analysis

Michele Battisti, Andrea Lavezzi, Lucio Masserini () and Monica Pratesi ()
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Lucio Masserini: Università di Pisa
Monica Pratesi: Università di Pisa

No 14115, Working Papers LuissLab from Dipartimento di Economia e Finanza, LUISS Guido Carli

Abstract: In this paper we perform a statistical evaluation of whether it is worthwhile, in economic terms, to resist to extortion demands by the ma a, from the point of view of rms operating in an area dominated by criminal organizations. We use a unique collected and matched database on rm characteristics on the city of Palermo, highly controlled by the ma a racket. The underlined idea is that the claimed resistance has (direct and indirect) costs and bene ts, so that a rational rm should take this decision according its economic expectations on the future pro ts (in addition to potential ethic considerations). It means that the economic policy messages of this experience can be linked to make more pro table the racket resistance (as a signal sent to the market). Our evidences based on multilevel discrete choice models show that this decision is strongly in uenced by socio-economic characteristics of the district, type of activity involved and other factors.

Keywords: Organized Crime; Racketeering; Economic Growth; Discrete choice models. (search for similar items in EconPapers)
JEL-codes: C41 K42 O17 R11 (search for similar items in EconPapers)
Date: 2014
New Economics Papers: this item is included in nep-dcm and nep-law
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http://www.luiss.it/RePEc/pdf/lleewp/14115.pdf (application/pdf)

Related works:
Journal Article: Resisting the extortion racket: an empirical analysis (2018)
Working Paper: Resisting the Extortion Racket: an Empirical Analysis (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:lui:lleewp:14115

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