Organized Crime is being recognized as the one element that is causing an unlawful distribution of the national wealth, leading to slow economic growth and depriving society of benefits that would otherwise accrue from a lawful machinery of a running business.
Organized Crime networks have an economic function primarily, but their cultural and social dimensions cannot be denied (Xudho, 1996). The spread of Organized Crime has been rapid in nations where communism was replaced by democracy. This institutional shift entailed moving away from a “centrally planned economy” to a market driven one and also a radical change in social life (Irrera, 2006). Ethnic problems, compounded by endemic civil wars, created a vacuum in the economy, which was filled by the “illicit market”, dealing in weapons, humans, cigarettes, drugs and even nuclear material.
As we have seen earlier, this market flourished with the patronage of police officers, politicians, businessmen, civil servants and even intelligence officers. This nexus, between crime and government and other social institutions “weaken the rule of law” which ultimately affects society, due to its “significant incidence on political stability” (Irrera, 2006)
Christopher Holbrook, in his study entitled “Europeanization of the Mafia” says that the rise of Organized Crime destabilizes the process of installing a “functioning market economy and a stable and democratic government and a dynamic civil society”.