Illicit Transnational Enterprises and the State

Abstract

This article aims at contributing to the current debate over the effects of illicit transnational activities on states. Recent avenues of conceptualizing transnational organized crime call for defining it as an economic activity with the scope of profit, rather than a criminal activity. Illicit transnational business activities largely follow the trends in development of legal business. The transnational criminal enterprises emerged in parallel to the growth of multinational corporations, making use of the same opportunities as legal business did. The article discusses violence by illicit enterprises and reviews current theoretical debate on the linkages between illicit enterprises and the state. The paper then proceeds with an empirical analysis of the effects of the presence of illicit enterprises on state weakness. We have hypothesized that weak states may have higher presence of criminal businesses. The findings generally confirm significant correlation between the two variables. State fragility is positively correlated with the presence of organized crime. Testing these results against empirical evidence partially confirms the findings. However, this correlation might be weakened by the observation that the presence of illicit enterprises alone does not determine state fragility or strength.

Keywords

• illicit business
• states
• transnational crime
• violence
• non-state actors
• weak states