The Underground Economy: Global Evidence of its Size and Impact

David Robinson, an economics professor, is dean of the Faculty of Social
Sciences at Laurentian University.

Underground Economy is actually a troupe of ideas looking for a home.
The troupe seems to include tax evasion, informal businesses,
traditional economies, drug and currency smuggling, and almost any other
activity that governments would like to tax, regulate, or record but
can’t.

The essays in this intriguing, if uneven, volume cover Britain, the
United States, Mexico, Peru, Chile, Russia, China, and Canada. Much of
the book is spent on estimates of the size of the underground, informal,
or illegal economies. The essays vary in technical level as well as in
their conclusions. A piece by Jon Kesselman shows that it is hard to
even be sure that tax evasion in the underground economy is entirely
harmful. Articles on Canadian attitudes toward taxation, drugs, the core
competencies of the Mafia, U.S. currency held abroad, and provincial
finances add variety.

Although the editors’ introduction is helpful and the book is well
produced and well organized, a few criticisms are in order. The volume
would be easier to use if the table of contents identified the authors.
The material is often repetitive, and a reader is likely to come away
from it frustrated with the variety of approaches and views. The
writing, though clear, is generally pedestrian.