![]() Other studies found that the supply of illegal goods is usually provided by small-scale criminal groups, and highlighted that the illegal economy functions like the legal one: it involves supply and demand, customer preferences and competition. In a study of drug markets, for example, it was found that groups consisted of "individual entrepreneurs and small organizations rather than massive, centralized bureaucracies," which were "competitive" rather than "monopolistic" in nature (Adler, 1985). The enterprise model of organized crime focuses on how economic considerations lie at the heart of the formation and success of organized criminal groups, more importantly than hierarchical or cultural considerations, The enterprise model labels economic concerns as the primary cause of organized criminal behaviour. The only difference between organized criminal groups and legitimate business is that organized criminals deal in illegal products and services, whereas legitimate businesses normally do not (Smith, 1980 Smith, 1990). Organized crime versus legitimate businessĪccording to the enterprise perspective, organized criminal groups form and thrive in the same way that legitimate businesses do: they respond to the needs and demands of suppliers, customers, regulators and competitors. Their ultimate objective is to make a profit out of these activities. ![]() The groups find ways to supply those goods and services while navigating among the risks posed by law enforcement, as well as legal and illegal competitors (e.g., other illicit products and groups). Organized criminal groups were found to structure their illicit activities around the demands of customers e.g., for illicit drugs, firearms, or stolen property. ![]() ![]() The enterprise model of organized crime grew from the realization that the regulatory framework and economic factors were the primary determinants behind the formation of organized criminal groups. Enterprise or business model of organized crime ![]()
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