Firms in Italy keep mafia closer when credit is tight – paper
Economic shocks make it harder for businesses to refuse cosa nostra’s offers, says central bank report
When access to formal credit is too expensive, more businesses seek funding from organised crime, according to new research from the Bank of Italy.
Marc Castelluccio and Lucia Rizzica’s paper, published on October 13, looks at firms in Italy between 2018 and 2020. It finds that an “unexpected substantial drop in revenues” – such as the one resulting from restrictions during the pandemic – causes more firms to look for mafia funding. A 10% drop in revenues “generates an increase in the likelihood
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