Mafia protection firms require negligible fixed capital, unlike most industries

Evidence

Let us begin by considering the role of fixed capital in the protection industry. In terms of the kinds of resources required, neither premises nor office equipment is likely to count for much of a firm’s assets. Woody Allen, nonetheless perceptive for being a humorist, once wrote: “Reliable sources indicate that the Cosa Nostra laid out no more than six thousand dollars last year for personalized stationery, and even less for staples. Furthermore, they have one secretary who does all the typing, and only three small rooms for headquarters, which they share with the Fred Persky Dance Studio” (1975: 13). Readers inclined to dismiss this anecdote as a joke never visited the “office” where Carmelo Colletti, mafia boss in the town of Ribera in Agrigento, conducted his business. Colletti would welcome his “friends”-among them prominent local politicians and wealthy Palermo entrepreneurs-in a little glassed-in box which stood inside the car showroom he owned with his sons. This was his practice until he was shot dead in that very office in 1983 (OSAG: 61, 187; OSAG Arnone: 83, 100). Colletti’s premises were not the exception among contemporary mafiosi, nor were they the product of Sicilian “backwardness,” given Joe Bonanno’s meticulous account (presumably uninfluenced by Woody Allen) of his own New York headquarters: [My] office was a small private room in the back of a political club which I had set up for the benefit of my friends. — Diego Gambetta, The Sicilian Mafia The Business of…, 152

Categorization

• XREF: Connects directly to Gambetta’s core thesis that protection is a labor-intensive, reputation-based trade — complements the Milgrom private-judges analysis in the reading purpose.