chapter  3
67 Pages

The Economic Organization of Drug Selling Gangs

WithLiza Vertinsky

This chapter suggests that the nature and structure of an income generating gang can be explained as an efficient response to economic conditions and that as these conditions change the organization will adapt to fit the new environment. It focuses on the premise that the nature and structure of an income generating gang can be explained as an efficient response to economic conditions and that as these conditions change the organization will adapt to fit the new environment. The chapter presents an economic model similar to those employed in the industrial organization literature is developed to explain differences in the organization of criminal street gangs. It deals with an overview of existing theories of gang organization. The chapter seeks to provide an economic rationale for some of these differences. It also focuses on the cost and availability of information rather than the absence of legally binding contracts as the distinguishing feature of illegal transactions.