Main Article Content
Fighting against money laundering and corruption is being a continuous problem for keeping the integrity of the socio-economic system of a country. Usage of the money generated from criminal activity in legal and formal economy seriously harms the stability and solidity of subjects/actors operating in a certain market and also the entire financial market of a country. Meanwhile, in developed countries, many researchers have been dealing with criminality and economic analysis from a financial perspective, laundering illegal capital and its operation informal economy; in Western Balkan countries, economic literature is mainly focused on organized crime and its activity, paying no specific attention to the usage of this money and where the money is really addressed. We have to underline that in the last two decades, the phenomenon of crime infiltration in the economic and social areas throughout networking with policymakers, is becoming more and more present in Western Balkan countries. Based on the facts mentioned above, the scope of this study is to give a general view and discuss different aspects of money laundering in Western Balkan countries, the costs of money laundering, forms of laundering, and also its infiltration into the legal, formal economy. This study is based on an existing literature review on money laundering and consisting later of a qualitative and quantitative analysis of some cases and schemes that have been published in the respective media of these countries. Empirical findings suggest that the construction sector, farming, and tourism, are the three main sectors money laundry is applied mostly. Empirical results show also that existence of a strong criminal economy leads to an increase in the corruption level, decreases the efficiency of public administration, and also, affects negatively economic growth.
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