The capo mafia provided the trust that made cartel collusion stable

Evidence

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 (#expands, via linked claim)

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)

Categorization

• XREF: connects to: Mafia protection makes collusion more likely, elaborate, and enduring — Diego Gambetta, The Sicilian Mafia The Business of…, 521; Mafia protectors favor group cartels over monopolies to avoid defection risks; Cartels hire mafia-protected unions as enforcers to coerce reluctant clients (+3 more)

Related

• Cartels hire mafia-protected unions as enforcers to coerce reluctant clients (similarity 0.92)
• Mafia protection makes collusion more likely, elaborate, and enduring (similarity 0.88)
• Collusive agreements remain fragile and racketeers overstay their welcome (similarity 0.83)
• Cartel equilibria are more fragile than competitive ones (similarity 0.83)
• Racketeers enforce cartel agreements that lie beyond legal sanction (similarity 0.81)
• Racket-run cartels reduce production efficiency more than conventional cartels (similarity 0.79)
• A mafioso guaranteed cartel quotas when few sellers made collusion enforceable. (similarity 0.79)

Broader Connections

• Mafia protection makes collusion more likely, elaborate, and enduring #expands (0.85) — Diego Gambetta, The Sicilian Mafia The Business of…, 521
• Racketeers enforce cartel agreements that lie beyond legal sanction #corroborates (0.80) — Thomas C. Schelling, The Strategy of Conflict, 774
• Mafia enforcement makes distrust rational and blights mutual-benefit competition #expands (0.78)
• Cartels hire mafia-protected unions as enforcers to coerce reluctant clients #exemplifies (0.75)
• Mafia protectors favor group cartels over monopolies to avoid defection risks #qualifies (0.72)
• Competitive pricing minimizes trust demands while cartels create them intensely #complicates (0.70)