Mob Economy

Discussion in 'Business & Economics' started by eddymrsci, Sep 4, 2004.

  1. eddymrsci Beware of the dark side Registered Senior Member

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    hello, a question poped up in my head as I was researching about organized crimes for a school project.

    How had underworld/mafia affected and contributed to world economy in the history, and how much of the world economy do they control today?

    thanks
     
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  3. dixonmassey Valued Senior Member

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    Wow, 2nd question is unanswerable I am afraid.

    Actually, all world economies began as mob economies. At the dawn of states, the most daring/intimidating folks imposed their power on the less blessed in that department forcing them to pay tribute (tribute gathering or racket; there is no much difference).Who wereRomul and Rem (legendary founders of Rome), they were ancient mobsters to put it simply. The very first feudals were nothing BUT the mob. Some of them were in the mob to the end (German robber barons, etc.). Who was Rurik (famous Kievan Rus prince)? Nobody but viking mobster.

    Strongest mob eradicated competitors, created proto-state and proto-laws to preserve its dominance. Later on states began the life of their own and forgot about their origins. The problem was/is that fresh mob inclined folks (i.e. those who think they are more deserving than the rest of toiling commoners) were constantly born. However, they were too weak/dispersed to compete with the established states openly (in all but few cases). So black market/world were born to circumvent the laws imposed by the legal descendands of the ancient mobs (i.e. by states). Mob was always around. however, due to the explosion of media, there is an impression that mob power is something new.

    As states began relying more and more on relatively low paid beaurocracy to function, mob got a chance (it never had before) to affect states, state's policies and laws. Corruption bring official and underworlds together in numerous ways. We live in somewhat unfortunate time cause commoners are being fleeced both by state and underworld in one way or another. Severity of the combined fleecing depends on the state. Russia is a severe case of the double fleecing, for example. However, according to the jungle law, the strongest mob will sooner or later win. Thus, even in Russia, state sponsored mob (a.k.a - police force), kick out/kill out the underworld mob just to take its place. In other words, if 10 years ago a Russian businessman would pay "tribute" off to the mob. Today, the very same businessman will take his $ to the police station to pay off for protection.

    In other words, mob and state (official mob) live in parallel. State is weak =mob is strong; State is strong = mob is weak or unexistent (example - Italy. During Mussolini times, Sicilian mob was basically exterminated in just 1 year).

    It's such a vast, well covered subject; you should use google; there is plenty of info.
     
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  5. eddymrsci Beware of the dark side Registered Senior Member

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    according to a book, there has been statistics that claim the volume of money being transferred in black and gray markets in today's world is estimated to be at least $1 trillion, more than most nations' GDP's.
     
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  7. Undecided Banned Banned

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    I think it was Russia, half of the GDP is lost in the black markets.
     
  8. eddymrsci Beware of the dark side Registered Senior Member

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    why do you think the mob controls so much of the Russian economy. what do they do? the same old traditional methods like gambling, narcotics, prostitution, job trafficking, smuggling, and etc.?
     
  9. dixonmassey Valued Senior Member

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    Cause Russian mob charges less (for protection, other sleazy things) than the Russian state mob does. It's more efficient to kick debts out of somebody using a raw force of the mob than by using inefficient corrupt courts. It's cheaper to compete in the market by eliminating your competitors using killers, and so on. In other words, Russian mob is a tool of market self-organization. Its importance is declining gradually.

    Besides "helping" businesses to "solve problems", Russian mob is heavily engaged in the export of Russian prostitutes all around the world, also it's controlling/owning legit businesses like banks, etc. (and using mob means to "excell") . Mob is doing all kinds of things ......
     
  10. Undecided Banned Banned

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    Another thing about the Russian mob is that it is well organized because it had to be. It was the only real outlet for the Soviet Union to consumer goods from the west. They expanded in Russia because the inefficient Soviet government was not able to manufacture enough “blue jeans”, or other quality consumer goods. Once the USSR feel there are two mobs in Russia, one being the traditional mob, and the other being the oligarchs.
     
  11. hypewaders Save Changes Registered Senior Member

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    In the sense that governments are society's consummate protection rackets, it can be said that most of the world's economy is controlled by mafias. Most of the remainder is controlled by multinational corporations in concert with government mafias. Ever shrinking is the simpler ancient segment dealing in reciprocity of effort and benefit between individuals, which is much older than money and interest, and which in "developed" societies seems increasingly rare, but still spontaneous.
     
  12. eddymrsci Beware of the dark side Registered Senior Member

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    about how much the mob controls the modern economy, I once heard from a TV show that the mafia dominate about 6.3% of world's economy through narcotics, real estate, smuggling, gambling, prostitution, and counterfeit.
    Although the show was comedic in nature, but the info was presented as a proven fact (either out-of-date or up-to-date) and was no joke.
    Is this info in any way supported or true? Have you heard a similar thing anywhere? and if it has some support, is the info historic or modern?
    thanks
     
  13. Undecided Banned Banned

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    Here’s a tid bit from the economist about why the black markets are so prevalent in developing nations:

     

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