black economy

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Black Market

A market for products that are illegal, stolen, or otherwise need to be hidden from regulatory authorities. A black market encompasses the horrific (e.g. human trafficking) as well as the more mundane (e.g. participating in the market to evade taxes). Legal products on a black market are usually less expensive than on the regulated market because sellers do not pay taxes on their goods and services. That said, there is little or no recourse for the customer if and when a black market product fails. It is worth noting that black markets tend to be largest in jurisdictions where there are the most regulations and government monopolies. It is also known as an underground market.

black economy

NONMARKETED ECONOMIC ACTIVITY that is not recorded in the NATIONAL INCOME ACCOUNTS, either because such activity does not pass through the market place or because it is illegal. Illegality is not the same as nonmarketed activity. Illegal economic activity may operate quite efficiently in the usual PRICE SYSTEM, which is determined by SUPPLY and DEMAND. Examples may be the purchase and sale of illegal drugs on the street, or alcohol in the US prohibition era of the 1920s, or foodstuffs in Britain during the Second World War when RATIONING was in force. Nonmarketed activity does not have a price determined by demand and supply Certain nonmarketed activity may be undertaken for altruistic reasons, for example, the services of a housewife on behalf of her family and the work of charity volunteers. Other nonmarketed activity is done on a BARTER basis, for example, where a mechanic services the motor car of an electrician who in return installs new light fittings in the mechanic's house. Money has not changed hands and the activity is not recorded. Most references to the black economy refer to the illegal situation of people working without declaring their income. See BLACK MARKET.
References in periodicals archive ?
Finding a significant association between participation in the urban informal economy and the perceived level of penalties and risk of detection on the one hand, and participation in the urban informal economy and the level of tax morale on the other, as well as complex positive interaction effects, section five then concludes by drawing out the theoretical and policy implications.
Conceptual justification for the application of monetary method is related to the fact that cash is considered to be the main way of exchange for informal economy transactions.
Maglunsod presented the DOLEs accomplishments and plans for transitioning workers from the informal economy to the formal economy.
The agency said informal economy is "marked by the denial of rights at work, the absence of sufficient opportunities for quality employment, inadequate social protection, a lack of social dialogue and low productivity, all of which constitutes a significant obstacle to the development of sustainable enterprises.
He drew attention to the fact that the businesses operating in the informal economy created unfair competition for lawful businesses.
Federal transfers and presumably the informal economy have maintained consumption levels in recent years.
Jauch said, "The CEO is correct in pointing out that the informal economy needs to be covered by social security as well.
Drawing on experiences and observations during his parish pastoral ministry, Rapu argues that the pervasiveness of poverty in Nigeria is a result of structural failures that cause the formal economy to continually dwindle while the informal economy rapidly expands, creating atypical jobs.
Highlighting these many and complex connections, as the recent special issue did, as well as historicizing the informal economy can help us to conceptualize the South African economy as a whole rather than as existing in two separate worlds.
The author defines the informal economy as "all economic activities which would generally be taxable were they reported to the state (tax) authorities" (p.
When the informal economy becomes regulated and formalized by the use of cards, it will gain 11.
5 trillion ($3 billion) -- hardly one third to the size of informal economy.

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