Impact of Socioeconomic Factors on the Proliferation of Organized Crime in Western Balkan Countries

Examining organized crime in the Western Balkans is essential to evaluate its socioeconomic consequences and develop informed policy responses. Historically, the Western Balkans have been susceptible to organized crime, particularly following the disintegration of Yugoslavia in the 1990s. The political and economic turmoil created a fertile environment for criminal networks to prosper in diverse illegal dealings. This paper explores the complex interplay between socioeconomic factors and the proliferation of organized crime in the Western Balkans from 2010 to 2022. Several econometric models are used in the study, including Ordinary Least Squares (OLS), OLS with Robust Standard Errors (OLSR), Fixed Effects (FE), and Random Effects (RE), to assess the impact of socioeconomic factors such as unemployment, education, income per capita, inequality, rural Population, COVID-19 impact, government corruption, rule of law, government effectiveness, and the Human Development Index (HDI) on organized crime. The findings demonstrate that higher unemployment rates, particularly among youth, and lower levels of education are linked to the proliferation of organized crime, emphasizing the critical role of socioeconomic instability in sustaining criminal networks in the region. Interestingly, the paper notes a decrease in organized crime rates associated with improvements in governance, such as stronger rule of law and more effective government operations. Furthermore, there has been a notable reduction in organized crime during the COVID-19 pandemic, suggesting shifts in criminal activity patterns and law enforcement priorities during this period.