Racketeers enforce cartel agreements that lie beyond legal sanction
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
Categorization
- ADDENDUM: Directly evidences the private-enforcement model in the ‘On Sacrifice’ and Mafia-protection logic the reader maps to Gambetta and Milgrom.
- XREF: This is the canonical Gambetta private-protection-market example — price-fixing enforced by paid violence. — connects to: Collusive agreements remain fragile and racketeers overstay their welcome; Racket-run cartels reduce production efficiency more than conventional cartels — Diego Gambetta, The Sicilian Mafia The Business of…, 531; The capo mafia provided the trust that made cartel collusion stable (+3 more)
Related
- Collusive agreements remain fragile and racketeers overstay their welcome (similarity 0.86)
- Cartels hire mafia-protected unions as enforcers to coerce reluctant clients (similarity 0.85)
- Racket-run cartels reduce production efficiency more than conventional cartels (similarity 0.84)
- The capo mafia provided the trust that made cartel collusion stable (similarity 0.81)
Broader Connections
- Corrupt auction dealings breed commitment failures that invite mafia enforcement
#corroborates(0.82) - A Law Merchant institution can sustain honest trade as an equilibrium
#complicates(0.74) — PAUL R. MILGRO, PAUL R. MILGRO - THE ROLE OF…, 95