If you look at it thematically, I think the "mob story" and the Western have a lot more in common than you might think. One of the overriding characteristics of both is rejection of authority. In the prototypical Western, you have a lone cowboy in the "frontier," an area defined as beyond ordinary law. Mob stories also take place beyond the law.

If they're the same type of story, then why change? I theorize that it has to do with the shifting population of the United States.

Every 10 years, the U.S. census doesn't just count the number of people in the country, it counts the proportion of people in urban and rural areas. In the 2010 census, urban areas accounted for 80.7 percent of the U.S. population. That's the highest figure it's ever been. But we need to look backward to see the signs of a shift in the mid-to-late 20th century.

The 1920 census was the first to show a greater share of the U.S. population lived in urban areas than rural ones. In that census, 51.2 percent of the population lived in an urban area. By 1970, that figure was 73.6 percent.

For young Americans, the Western had ceased to have meaning as a setting. How can you care about a Western when you've grown up in a city your whole life? Furthermore, the people writing the films and movies and books in the 1970s had grown up in urban areas, too -- if they're writing from their experience, the statistics show that that experience was probably an early one.

As early as 1950, when the Baby Boom generation (which came of age in the late 1960s and the 1970s) was being born, the U.S. population was nearly 60 percent urbanized. By the 1970s, they were of an age to start contributing works of fiction on a large scale.

What about Mario Puzo? He's from New York City, and he was born in 1920 ─ the first time the U.S. census indicated more urban residents than rural ones.

I think this is more of a parallel development than a replacement. The first true crime story was written by EA Poe in his short story "The Murders in the Rue Morgue" It was not so much of a development to move from and detective/ lawman centered story to a criminal centered story. While this did not really happen until the rise of the "Pulps" in the early 1900s it can be seen that the cowboy/Western was also under development as its own genre at the same time as the crime pulps. That is why I call it a parallel development. To tell the truth I must question your premise. While I have no doubt that 'The Godfather" is an epic of sorts and in many ways speaks to the American character is is really hard to say that it supplants the Western as the dominate American epic genre in the American psyche.

Here is my thought on the subject. There are many American epic genres because we are much too diverse for us to have one defined story type as our epic. For me we have the Leather Stockings Tales, Moby Dick, The Western, the Epic fantasy series The Wheel of Time by Robert Jordan, The Godfather, and the comic book superhero. I would even go as far to say that the narrative of the Civil Rights movement and the slave narrative from the 19th century helps define the American character outside the traditionally white male genres I previously stated.

TLDR--- To say the crime story replaced the Western as the American epic is a gross over simplification of a very complex idea.