Black Markets

Which Countries' Shadow Economies Are Biggest?

Greece, Italy take the lead; the U.S. keeps it relatively small.



A new study from the the University of Tübingen attempts to estimate the sizes of several developed nations' shadow economies. Not surprisingly, the biggest black markets on the list are in Greece, where the subterranean economy takes up 21.5 percent of the country's gross domestic product, and in Italy, where the figure is 19.8 percent. The smallest (relative to GDP) is in the United States, where the total is a mere 5.4 percent. You may be tempted to take that as a dispiriting signal that we've lost that insubordinate American spirit; I prefer to see it as a promising sign that our Leviathan doesn't drive as much peaceful trade underground.

If you can read German, you can check out the study here. Those of us who can't read German will have to make do with Forbes's write-up here. And if you just want to see a snappy infographic, Forbes and Statistica put together this handy chart:


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  1. It’s worth noting that this chart shows System D as a percentage of the GDP, so it’s possible that the US has a bigger underground economy in sheer dollar terms, or even per capita than some of those smaller loser countries.

    Also, is tentacle porn considered underground or regular economy in Japan?

    1. I hope so, or I weep for my country.

      (considering Greece’s GDP is a mere $200 bn and Italy’s is $2 trillion or ~1/8 of the US’s, you look to be right)

      1. Yep. Quick back of the napkin calcs indicate that the measly 5% US shadow economy is worth a trillion dollars, making it a larger shadow economy in pure dollar value than any others by far (over twice that of runner up Japan and 24x as large as tiny Greece).

  2. You may be tempted to take that as a dispiriting signal that we’ve lost that insubordinate American spirit; I prefer to see it as a promising sign that our Leviathan doesn’t drive as much peaceful trade underground.

    Does it count the drug trade? I’m guessing no, but the Forbes article doesn’t mention that.

    1. Was just going to ask that – is illegal drug trade included in these numbers?

    2. Looking things up, it wouldn’t matter!

      RAND corporation estimates illegal drug trade in US at around $100 billion (2010 dollars).
      Wiki has a UN estimate of $396 billion world-wide.

      US GDP for 2013 is listed as $16.67 Trillion.

      1. OK. $100 bn puts it at about 10% of the black market. Seems low to me.

        What does make up the nearly trillion dollar black market? Software? Music? Female hygiene products?

  3. How is France not listed? I ask that because I doubt it’s black market is smaller than the USA’s. It’s gotta be near the top or middle.

    1. its

    2. According to the German version, France is just ahead of Norway at 12.8%. Portugal — 16.6%, Belgium — 15.6%.

      1. Makes sense.

    3. Gotcha. Thanks.

      It’s weird they didn’t study France though.

  4. Where’s China fall on this scale?

    seems like that’s probably the largest and certainly the most interesting

    1. I imagine there’s some difficulty in collecting the data without being disappeared by the government.

      1. Do you think the Chinese state would let your family buy a bullet on the black market rather than paying the government rate?

        1. It’s worth noting here that the black market price is rarely, or ever, the lowest price. The difference is that goods are actually available at the black market price while the shelves are bare at those establishments holding to the official price.

          Thus when it comes to execution bullets I want my family to chose official bullets. At least then even if I don’t luck out that it’s one of the times when they’re out of stock, I’ll at least know I got the lowest price. 🙂

  5. I’m looking at my lunch right now. No way the veggies aren’t from the shadow economy.

  6. f you can read German, you can check out the study here. Those of us who can’t read German will have to make do with Forbes’s write-up here.

    It’s much better in the original German.

    1. The Schei?eporn is a nice touch.

  7. Muriburiland has twice the black market of the US? I thought it was progtopia. Why don’t these people want to pay their fair share of taxes and follow the rules set out for the good of their fellow man?

  8. Greece and Italy I get. I’m actually surprised by how high Germany’s number is.

    I thought they knew how to keep in line! Guess it is the influence of the former East Germany. :—)

    1. Even good, burgerliche Germans can be fed up with their high costs of living in the pacifist social welfare paradise and do a few deals under the table. It’s just that they don’t show that they’re annoyed.

    2. Hamburg is the second busiest port in Europe, which I am sure helps them smuggle in goods to be sold.

    3. I lived in Germany over 30 years ago and it was common for business owners to ask when negotiating a transaction “Rechnung?” (receipt?). “Nein!” meant the price would be lower.

  9. I wonder what the percentage is in California and Los Angeles. I’ve heard estimates in LA of close to 30%, with nannies, gardeners, tutors, painters, etc. being paid under the table in cash.

    1. Yeah, it has got to be pretty high. Not just “underground” stuff but straight tax evasion. I worked next to a sandwich shop that didn’t use a register. They used little notepads to write your order down and then totted up the price on a tiny calculator that didn’t run tape. And they only took cash. I have to assume they reported far less than they took in and that this sort of thing is very common in mom & pop operations.

      Especially in the more ethnic areas where the tax folks and assorted regulators didn’t know the culture or speak the language it would be easy to hide one’s shenanigans.

  10. How the heck are you judging black market without including Somalia? Isn’t 100% of their economy black market? (No, I’m not making a racist joke, I’m pointing out they’re all pirates.)

  11. RE: Which Countries’ Shadow Economies Are Biggest?
    Greece, Italy take the lead; the U.S. keeps it relatively small.

    The top five countries are socialist, so why would they need a shadow economy.
    After all, socialism solves all problems, especially economic ones.
    All the useful idiots on the left has said so many times over.

  12. does drugs count as a shadow economy?

    I wonder how much that is and if you made drugs legal how small our percentage would be.

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