NCJ Number
173807
Editor(s)
S Pozo
Date Published
1996
Length
172 pages
Annotation
Six papers on the underground economy examine its many facets, various consequences, and multitude of interpretations.
Abstract
Two papers focus on measuring the size and volume of underground economic activity. One study uses monetary techniques to measure the volume of unreported economic activity. It examines what is known about U.S. currency holdings abroad to derive estimates of the proportion of U.S. currency that circulates domestically. The author uses a variant of the currency-to-deposit ratio method to estimate the size of the underground economy. The second paper analyzes a specific subsector of the underground economy, i.e., the illegal drug market. It argues that U.S. government estimates regarding the size of the drug market are inadequate and inconsistent. The author shows how individually scrutinized estimates are implausible and how the collective estimates of related markets or variables within the market are inconsistent. Two papers are concerned with the criminal behavior of individuals. One focuses on youth and the factors that influence youth to participate in underground economic activities. The other paper examines tax evasion and how economic policy affects the degree of tax cheating. The two remaining papers provide overviews of the underground economy in the Americas. Despite the diversity of approaches in the six papers, many common conclusions emerge. First, the underground economy is significant in size. Second, growth and persistence in the underground economy are not relegated to a particular historical period, geographic region of the world, or stage of development. Third, economic policy can have a significant role in determining whether economic agents participate to a greater or lesser degree in the underground economy. Chapter figures, tables, notes, and references, and a subject index