Lesson 19: International Crime

  1. Review of readings and assignments.
  2. Discussion of factors encouraging illicit trade.
    1. Globalization:
      1. Changes in rules -- trade liberalization, currency liberalization, etc.
      2. Changes in technology
      3. Vast increase in scale of trade -- easier to hide within legitimate trade
      4. "Golden Straightjacket": fiscal restraint, cuts to law enforcement budgets
    2. Fall of communism / Soviet Union:
      1. supply shock: weapons, human capital, entrepreneurs-in-waiting
      2. newly privatized, inefficient firms seeking willing buyers
      3. weak governments no longer being propped up by superpowers: explosion of civil wars, insurgencies, etc., leading to...
    3. Weak/failed states
  3. 6 areas of illicit trade:
    1. Weapons
    2. Drugs
    3. Money
    4. Counterfeits
    5. Human Beings
    6. Other: organs, art and archaeology, endangered species, wastes
    What is involved in each of these areas? (whole class discussion)
  4. small-group discussion, one group for each of the 6 areas:
    1. Do you have any personal experiences or stories related to this trade?
    2. What are the effects of this illicit trade on society?
    3. What drives demand? Supply?
    4. Can this trade be made less profitable/attractive?
  5. Wrap-up and conclusion.
Take-home point: The same forces that drove globalization also allowed an even greater explosion in illict trade. Illicit trade is an economic phenomenon, of supply meeting demand, but it has multiple harmful effects on society.