IDEAS home Printed from https://ideas.repec.org/p/not/notcre/12-01.html
   My bibliography  Save this paper

Origins of the Sicilian Mafia: The Market for Lemons

Author

Listed:
  • Arcangelo Dimico
  • Alessia Isopi
  • Ola Olsson

Abstract

Since its first appearance in the late 1800s, the origins of the Sicilian mafia have remained a largely unresolved mystery. Both institutional and historical explanations have been proposed in the literature through the years. In this paper, we develop an argument for a market structure-hypothesis, contending that mafia arose in towns where firms made unusually high profits due to imperfect competition. We identify the market for citrus fruits as a sector with very high international demand as well as substantial fixed costs that acted as a barrier to entry in many places and secured high profits in others. We argue that the mafia arose out of the need to protect citrus production from predation by thieves. Using the original data from a parliamentary inquiry in 1881-86 on all towns in Sicily, we show that mafia presence is strongly related to the production of orange and lemon. This result contrasts recent work that emphasizes the importance of land reforms and a broadening of property rights as the main reason for the emergence of mafia protection.

Suggested Citation

  • Arcangelo Dimico & Alessia Isopi & Ola Olsson, "undated". "Origins of the Sicilian Mafia: The Market for Lemons," Discussion Papers 12/01, University of Nottingham, CREDIT.
  • Handle: RePEc:not:notcre:12/01
    as

    Download full text from publisher

    File URL: http://www.nottingham.ac.uk/credit/documents/papers/12-01.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Halvor Mehlum & Karl Moene & Ragnar Torvik, 2006. "Institutions and the Resource Curse," Economic Journal, Royal Economic Society, vol. 116(508), pages 1-20, January.
    2. Smith, Rodney T, 1976. "The Legal and Illegal Markets for Taxed Goods: Pure Theory and an Application to State Government Taxation of Distilled Spirits," Journal of Law and Economics, University of Chicago Press, vol. 19(2), pages 393-429, August.
    3. Frederick van der Ploeg, 2011. "Natural Resources: Curse or Blessing?," Journal of Economic Literature, American Economic Association, vol. 49(2), pages 366-420, June.
    4. Buonanno, Paolo & Durante, Ruben & Prarolo, Giovanni & Vanin, Paolo, 2011. "On the historical and geographic origins of the Sicilian mafia," MPRA Paper 37009, University Library of Munich, Germany, revised 01 Feb 2012.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Barone, Guglielmo & Narciso, Gaia, 2015. "Organized crime and business subsidies: Where does the money go?," Journal of Urban Economics, Elsevier, vol. 86(C), pages 98-110.
    2. Tomás E. Murphy & Martín Rossi, 2017. "Following the Poppy Trail: Causes and Consequences of Mexican Drug Cartels," Working Papers 130, Universidad de San Andres, Departamento de Economia, revised Dec 2017.
    3. Paolo Buonanno & Ruben Durante & Giovanni Prarolo & Paolo Vanin, 2012. "Poor institutions, rich mines: resource curse and the origins of the Sicilian mafia," Working Papers 2012/29, Institut d'Economia de Barcelona (IEB).
    4. Giuseppe De Feo & Giacomo Davide De Luca, 2017. "Mafia in the Ballot Box," American Economic Journal: Economic Policy, American Economic Association, vol. 9(3), pages 134-167, August.
    5. Daron Acemoglu & Giuseppe De Feo & Giacomo De Luca, 2017. "Weak States: Causes and Consequences of the Sicilian Mafia," NBER Working Papers 24115, National Bureau of Economic Research, Inc.
    6. Rowena Gray & Gaia Narciso & Gaspare Tortorici, 2017. "Globalization, Agricultural Markets and Mass Migration," CReAM Discussion Paper Series 1713, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
    7. Paolo Pinotti, 2012. "The Economic Costs of Organized Crime: Evidence from Southern Italy," Working Papers 054, "Carlo F. Dondena" Centre for Research on Social Dynamics (DONDENA), Università Commerciale Luigi Bocconi.
    8. Guerriero, Carmine & de Oliveira, Guilherme, 2014. "Extractive States: The Case of the Italian Unification," MPRA Paper 70916, University Library of Munich, Germany, revised 13 Apr 2016.
    9. Aquilante, Tommaso & Maretto, Guido, 2016. "Cooperation in Criminal Markets," MPRA Paper 75949, University Library of Munich, Germany.
    10. Paolo Buonanno & Ruben Durante & Giovanni Prarolo & Giovanni Prarolo, 2013. "Rich Mines, Poor Institutions: Resource Curse and the Origins of the Sicilian Mafia," Sciences Po publications info:hdl:2441/16jvuuvsuc9, Sciences Po.

    More about this item

    JEL classification:

    • P48 - Economic Systems - - Other Economic Systems - - - Political Economy; Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:not:notcre:12/01. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Hilary Hughes) or (Thomas Cornelissen). General contact details of provider: http://edirc.repec.org/data/cenotuk.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.