Cartels hire mafia-protected unions as enforcers to coerce reluctant clients

Evidence

It has been argued that an important function of the racketeer is sometimes to help enforce agreements that are beyond the law. Price-cutting in the Chicago garment trade was punishable by explosion—the fee for the explosion being paid by the price-fixing organization—according to R. L. Duffus, “The Function of the Racketeer,” New Republic (March 27, 1929), pp. 166–68. — Thomas C. Schelling, The Strategy of Conflict, 774 (#corroborates, via linked claim)

Although it is difficult to establish ex post facto whether a given collusive arrangement would have come about even without mafia intervention, the availability of mafia services generally makes collusion more likely, more elaborate, and more enduring. Sectors ranging from the construction and transport industries to flower sellers on the street have been territorially controlled by the mafia in Sicily. Those who pay protection money expect territorial policing as a matter of course. As a partner in a firm near Palermo that sells reconditioned tires argued, “The least those who protect you can do is offer to discourage competitors should they want to enter your territory” (I-8). — Diego Gambetta, The Sicilian Mafia The Business of…, 521 (#corroborates, via linked claim)

Categorization

• XREF: connects to: Political radicalism in unions blocks organized crime infiltration; The capo mafia provided the trust that made cartel collusion stable; Mafia protection makes collusion more likely, elaborate, and enduring — Diego Gambetta, The Sicilian Mafia The Business of…, 521 (+1 more)

Related

• The capo mafia provided the trust that made cartel collusion stable (similarity 0.92)
• Racketeers enforce cartel agreements that lie beyond legal sanction (similarity 0.85)
• Mafia protection makes collusion more likely, elaborate, and enduring (similarity 0.85)
• Collusive agreements remain fragile and racketeers overstay their welcome (similarity 0.83)
• Racket-run cartels reduce production efficiency more than conventional cartels (similarity 0.80)
• Cartel equilibria are more fragile than competitive ones (similarity 0.78)

Broader Connections

• Racketeers enforce cartel agreements that lie beyond legal sanction #corroborates (0.90) — Thomas C. Schelling, The Strategy of Conflict, 774
• Mafia protection makes collusion more likely, elaborate, and enduring #corroborates (0.85) — Diego Gambetta, The Sicilian Mafia The Business of…, 521