Public institutions are structurally easy markets to monopolize and share

Evidence

A group of six or seven commissionari—those said to be of “great respect”—apparently collude over the contracts with institutions such as schools, hospitals, military barracks, and nursing homes. Each commissionario supplies specific institutions, and the problem of competition is eliminated radically: by common agreement only one commissionario bids for each contract. In comparison to private customers, public institutions are fewer in number and take out longer-term contracts; in addition, they buy fixed quantities and are generally less demanding about quality, less concerned about price, and corruptible. In short, they are easy to monopolize and share. — Diego Gambetta, The Sicilian Mafia The Business of…, 561

Categorization

Category: Causal Relationships

• ADDENDUM: Reinforces the third article’s theme that stable hierarchies/stratified arrangements find enforcers; here the state’s own institutions become the easy prey for a cartel that corrupts rather than coerces.

Related

• Public institutions are structurally easy targets for collusive market cartels (similarity 0.88)

Broader Connections

• Market monopolizability depends on the concentration of supply channels #corroborates (0.85) — Diego Gambetta, The Sicilian Mafia The Business of…, 559
• Violence capacity being dichotomous makes the protection market monopolistic #corroborates (0.85) — Diego Gambetta, The Sicilian Mafia The Business of…, 105
• Splitting LOGCAP contracts among firms produced mini-monopolies, not competition. #exemplifies (0.85) — David Vine, Base Nation_ How U.S. Military Bases…, 707
• Monopoly over clients can be restored by negotiation or sharing. #expands (0.80) — Diego Gambetta, The Sicilian Mafia The Business of…, 450
• Everyone relying on shared institutions is a fragile, tipable equilibrium #corroborates (0.80) — Russell Hardin, Trust and Trustworthiness, 521
• Territorial immobility determines whether a protection market is viable. #qualifies (0.80) — Diego Gambetta, The Sicilian Mafia The Business of…, 601
• Customers exercise more protection-market choice where the monopoly is insecure #qualifies (0.75) — Diego Gambetta, The Sicilian Mafia The Business of…, 418
• Cartel organization is not an automatic equilibrium of protection markets #qualifies (0.75) — Diego Gambetta, The Sicilian Mafia The Business of…, 276
• Customers become tradeable assets under cartel allocation agreements #expands (0.75) — Diego Gambetta, The Sicilian Mafia The Business of…, 526
• Private protection markets arise independently in many weak-state contexts worldwide. #corroborates (0.70) — Diego Gambetta, The Sicilian Mafia The Business of…, 847