Institutional Support and Conflict in Illicit Supply Chains and Transnational Smuggling Operations

Research output: ThesisDoctoral ThesisCollection of Articles


Over the past sixty years, progressive developments in transportation infrastructure, advancements in information communication technology (ICT), adoption of market based economic systems, increased mobility of human and financial capital have resulted in increased global trade. This has equated to social and economic advancements for both developed and developing nations. While these structural forces have benefitted licit businesses, it has also profited illicit ones. Illicit economies are principally driven by profit incentives and contain a unique set of risks, coordination, and transactions costs. This predominantly stems from the complex institutional and operating environments, which underpin illicit trade. The facilitation of illicit trade is coordinated through supply chains of an illicit form. Illicit supply chains share many of the same functional characteristics as licit ones. The fundamental difference lies in the operational strategies of illicit supply chain actors, designed to mitigate the risk of detection and arrest by law enforcement. These strategies contain distinct attributes such as stealth, hyper-flexibility, evasion, concealment, and corruption. One of the key operational activities within illicit supply chains is smuggling. Transnational smuggling is logistically intensive process, involving flows of physical goods, information, people, and capital. It also deals with unique transportation, storage, and packaging requirements, based on different forms of contraband products being delivered, relies on international transportation systems, and requires a level of coordination amongst various actors within an illicit supply chain. The capacity to cross national borders creates advantages for criminals; as it enables them to supply markets where the profit margins are the largest, operate from countries where the risks are least, complicate the tasks of law enforcement agencies, and adapt their behaviors and operational routines to counter or neutralize regulatory and public policy initiatives. Cross-border smuggling can be viewed as a core capability of organizations engaged in illicit trade. This research explores illicit trade and transnational smuggling operations from both a structural and operational perspective. This study utilizes established theories from institutional economics and operations managementd and aims to provide a basis for further research in this new area of inquiry.
Translated title of the contributionInstitutional Support and Conflict in Illicit Supply Chains and Transnational Smuggling Operations
Original languageEnglish
QualificationDoctor's degree
Awarding Institution
  • Aalto University
  • Vepsäläinen, Ari, Supervising Professor
Print ISBNs978-952-60-6168-9
Publication statusPublished - 2015
MoE publication typeG5 Doctoral dissertation (article)


  • illicit supply chains
  • transnational smuggling
  • operations management
  • logistics
  • transaction cost economics


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