TY  - JOUR
AU  - Anderson,James E.
AU  - Bandiera,Oriana
TI  - From Wild West to the Godfather: Enforcement Market Structure
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 8469
PY  - 2001
Y2  - September 2001
UR  - http://www.nber.org/papers/w8469
L1  - http://www.nber.org/papers/w8469.pdf
N1  - Author contact info:
James E. Anderson
Department of Economics
Boston College
Chestnut Hill, MA 02467
Tel: 617/552-3691
Fax: 617/552-2308
E-Mail: james.anderson.1@bc.edu

Oriana Bandiera
London School of Economics
E-Mail: o.bandiera@lse.ac.uk
AB  - Weak states enable private enforcement but it does not always fade away in the presence of strong states. We develop a general equilibrium model of the market organization of enforcers (self-enforcers, competitive specialized enforcers or monopoly) who defend endowments from predators. We provide conditions under which a Mafia emerges, persists and is stable. Mafias are most likely to emerge at intermediate stages of economic development. Private enforcers might provide better enforcement to the rich than would a welfare-maximizing state - hence the State may find it difficult to replace the Mafia or competitive private enforcers.
ER  -