Content area
Abstract
Organized crime is a concept at once familiar and yet also foreign. Although social scientists have done much to uncover the inner workings of these clandestine organizations, we have yet to fully understand the relationship between the state, criminal groups, and politico-economic development. This dissertation sets out to accomplish three things: (1) explaining the cross- and within-case variation of the organizational structure of criminal groups; (2) evaluating the strategies states employ when confronted with criminal groups; and (3) examining the effect these strategies, and the responses from criminal groups, have on national political and economic development.
I hypothesize that the organizational strategy of criminal groups is a function of the transaction costs they encounter in their respective political environments. Transaction costs are influenced by the state, the international environment, and/or the contours of the market. When transaction costs are high, criminal groups invest in hierarchical organizations to internalize governing structures that rely heavily on pre-existing familial/social networks and the use of violence. When transaction costs are low, criminal groups eschew such kinship networks and violence, instead investing primarily in productive activities and allowing the market to coordinate their actions.
I then evaluate the downstream consequences of these organizational strategies' interactions with the state. I argue that different outcomes depend on how states consolidate both economic and coercive authority. The organizational strategies of the criminal group determine how they will react to varying strategies of state authority. Facing a repressive state, a hierarchical criminal group will compete for control of illicit markets, whereas a non-hierarchical group will avoid the state, pursuing clandestine economic strategies that challenge the state's political and economic authority nonetheless. In the context of a permissive state, a hierarchical criminal group will cooperate in both political and economic spheres, becoming either a junior or senior partner in the relationship. A non-hierarchical group will also cooperate with a permissive state, but its relationship will be one in which they indirectly contribute to market development through private investment and are unlikely to share political authority.
