Towards a new model of the Philippine political economy IV

Posted: March 28, 2015 in Uncategorized

bong mendoza's blog

The criminal economic sector

The criminal economy covers all activities carried out in pursuit of economic gain that cover the production and/or provision of illegal goods and services. These may include gambling, prostitution, gun-running, and extortion, among others. These activities may also include the illegal production/provision of otherwise legal goods and services. For example, a pack of imported cigarettes is a legal product. But a criminal entrepreneur finds it profitable to smuggle it into a country. In the process, the cigarette pack becomes an illegal good. A video compact disk (VCD) may be a legal good. However, if an entrepreneur duplicates it without permission from the copyright holder and sells the same without paying royalties, then the product is illegal. The illegality of goods and services is the primary distinction of criminal transactions from formal and informal economic activity. While there may be overlaps in some of the commodities sold…

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