For every $10 spent on goods and services in the American economy, at least a dollar is spent in the “underground economy.” That share has trended up over the last 15 years and two recessions.
That $2.5 trillion in economic activity includes both licit and illicit activities — yes, paying the babysitter cash and buying an illegal gun are both in the underground economy. Poorer nations have higher rates, and likewise, poorer communities in the United States rely more heavily on the informal economy.
Contributing to the academic analysis, American sociologist and ethnographer Sudhir Venkatesh published in 2006 a book called Off the Books: The Underground Economy of the Urban Poor. Backed by years he spent visiting a particular poor neighborhood in Chicago, he chronicled the interpersonal and community dynamics that related to and developed its underground economy. In some ways the book shows its age (as a trivial example, his use of the word “ghetto” feels dated), but in other ways it remains a small, specific window into one community’s underground economy.
“The underground enables poor communities to survive but can lead to their alienation from the wider world,” as the author wrote.
Another of his points I especially liked: “What some might see as a mass of Americans lying about, and out of work, is in many cases an ensemble of persons who lack of private places where they can rest.”
The author renamed his characters and locations for anonymity, but generally follows a neighborhood he calls Maquis Park, including characters like a particular gang leader and an active block leader named Eunice. Below find my notes from the book for future reference.Continue reading Off the Books: The Underground Economy of the Urban Poor