Protection supply can create its own demand rather than merely meet it.

Evidence

Given the nature of protection, it can be argued that supply is more central to an explanation of the mafia’s origins than demand, because if the latter can only encourage the former, the former can undoubtedly create the latter. Once a protection market exists, it has a self-reinforcing quality whereby demand is increased by both positive and negative externalities. As we saw in Chapter 1. it is possible to conceive of a state of affairs in which there is no protection and no demand for it either, until an element of protection creeps in and the situation changes to one in which everybody muse be protected . In order to account for the emergence of a protection market, it is not necessary in theory to postulate the presence of exogenously generated distrust and a corresponding demand for protection. The fact that endogenous explanations may be more economical, however, does not imply that they are always true. — Diego Gambetta, The Sicilian Mafia The Business of…, 846

Categorization

Category: Causal Relationships

• DEEPTHINKING: The self-reinforcing supply-driven logic of protection markets is a genuinely paradigm-shifting mechanism for understanding mafia origins — the core causal claim of the book.
• SEED: A potential essay: how protection rackets (and platform businesses) fabricate their own demand through ‘either you pay us or someone else will’ externalities.

Related

• Protection suppliers can create demand that did not previously exist. (similarity 0.93)
• Demand for protection does not guarantee supply of a mafia (similarity 0.88)
• Mafia protection is a demanded commodity substituting for trust (similarity 0.88)
• A free market in quality can dissolve the demand for mafia protection (similarity 0.86)
• Protection demand, not commodity prosperity, predicts mafia entry into a market. (similarity 0.86)
• Mafia protection requires maintaining relations with the underworld it polices (similarity 0.84)
• American mafia arose where supply met demand, not from export (similarity 0.84)
• Mafia protection customers range from spot buyers to kin (similarity 0.83)
• The mafia can be understood as an industry selling private protection (similarity 0.83)
• The mafia protects everyone from peasants to arms dealers (similarity 0.83)
• Mafia protection makes distrust self-perpetuating and endogenous. (similarity 0.82)
• Mafia behavior is rational once considered as a protection-selling industry under competitive pressure (similarity 0.82)
• The mafia persists only where the state fails to supply genuine protection. (similarity 0.82)
• Mafia protection suppresses the emergence of honest-dealing business norms. (similarity 0.82)
• Protection substitutes for trust when trust is lacking in transactions (similarity 0.81)

Broader Connections

• Prior analysts conflate protected goods’ markets with the protection market itself. #expands (0.88) — Diego Gambetta, The Sicilian Mafia The Business of…, 47
• Protection markets arise spontaneously wherever predation creates demand #qualifies (0.75) — Diego Gambetta, The Sicilian Mafia The Business of…, 91