Sinclair Davidson’s post motivated me to re-blog James Buchanan’s argument about how organised crime reduced crime.
Remember, when the mafia ran casinos, they ran an honest house and didn’t like street crime scaring off customers from the neighbourhood.
Do monopoly concessions such as for casinos and the TAB increase or decrease gambling? Is the under-supply of output by a monopoly a good or a bad thing when the good itself is seen as a bad.
James Buchanan started his 1973 paper ‘A defence of organised crime?’ quoting Samuel Butler:
… we should try to make the self-interest of cads a little more coincident with that of decent people
Buchanan’s simple idea is that if a monopoly restricts the output of goods, a standard analytical result, then it must also restrict the output of bads! Buchanan end’s his paper with:
It is not from the public-spiritedness of the leaders of the Cosa Nostra that we should expect to get a reduction in the crime rate but from their regard for their own self-interests
The Cosa Nostra did have a reputation for running honest casinos and keeping crime down nearby.
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Utopia, you are standing in it! 
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