The Burden of Crime on Development and FDI in Southern Italy

Crime imposes different costs on society; these comprise those for its prevention, those sustained by the consequential victims and the cost of responding to crime. There is, furthermore, another kind of cost that does not correspond to direct monetary payment, but consists of lost investment, loss of jobs and fewer opportunities for development. In the case of Italy, the historical presence of organized crime in the Southern regions has represented a significant economic burden. Economists have tried to estimate these costs and the economic and social consequences of crime. The results of studies show clearly how a high presence of crime tends to affect economic outcomes negatively, creating notable distortions to local markets and a business climate that is unfavourable for foreign and national investment.