By Kristy Charlton
According to Helmke and Levitsky, an informal institution has three specific characteristics: the first is that the ideal of the institution is socially shared, the rules are unwritten and the ideals are enforced outside official channels.
Corruption might be an example of informal institutions, such as that displayed by the Italian Mafia.
The Mafia is a criminal and entrepreneurial economic organization that runs in different locations within Italy. It is an organization that deals within the Italian economic system in the form of loan sharking and extortion, an illegal form of business. The Mafia also runs in economic circles such as “textiles, transport, tourism, construction, and waste management” and selling of drugs. The groups make an estimated annual profit of €100bn – about 7% of Italy's GDP.
The rules of the group are unwritten in the sense that the way their business works is illegal in the form of extortion. An example of extortion is seen by telling a business they need to pay $100 to be protected from criminals, and by paying the money the Mafia will take care of them. There is also a sense of honor within the mafia that is stronger than any law that could be written down. This is socially accepted within Italy: you pay to not be killed by the people who are supposedly protecting you. The functioning of the Mafia works as an illegal political system: there is a leader and from there it is divided into smaller groups, doing different jobs. There work is not legal within the economic and political framework of Italy, and the Mafia rules are enforced on a completely separate entity to the government. They govern themselves and have their own laws and punishments that are enforced within their groups.