Blunt Force

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Comme dans de nombreux pays européens dernièrement, le débat sur l’introduction du marché noir dans le calcul du PIB est de nouveau à l’ordre du jour. Entre banalisation et estimations hasardeuses, cette idée reste fermement critiquée au Royaume-Uni, bien que l’activité illégale représente une part non négligeable de l’économie du pays.

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It came as a bittersweet piece of information when the Office for National Statistics (ONS) discovered that the black market has almost the same weight in the UK’s economy as agriculture and is barely less important than the publishing industry (including books and newspapers); since 2009, the ONS has been measuring the part of prostitution and drug dealing in the country’s GDP, showing that in 2009 the GDP would have been 4.6% higher if the illegal market had been added. As a result, Chancellor of the Exchequer George Osborne announced he intends to include the contribution made by prostitutes and drug dealers in the national GDP. He is supported by the Chief economic adviser at the ONS, Joe Grice, who explains that “in the UK these reforms will help the ONS to continue delivering the best possible economic statistics to inform key decisions in government and business”.

Thus, the United Kingdom will be the fourth European country after Sweden, Spain and Italy that will take illegal activities into account in the GDP; these countries have been following a recent European reform that aims at having the black market be counted up into their GDPs. One of the reasons may be the calculation of a country’s debt: when the GDP grows, the debt/ GDP ratio decreases theoretically. Furthermore, European budget contributions are pegged to a country’s GDPs, so adding the illegal market to them will make them grow – to the delight of Brussels!

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Yet, there are typical problems associated with the idea. The first one is the accuracy of the figures, which is questioned by Steve Pudney, a professor of economics at the University of Essex, who is skeptical about the methods used by the ONS to measure the weight of the illegal market. He says they are “large assumptions which would be difficult to test” and considers the suppositions are “likely to understate systematically the true scale of drug use”. Hence, Graeme Walker, the head of national accounts for the ONS, confesses that these measures do present limits to estimate the importance of illegal activities in the economy, but he defends the ONS by saying it remains a useful piece of information.

Adding the black market to the GDP also represents a moral problem. Indeed, many accuse this reform of trivialising illegal activities and their consequences. For example, the spokeswoman for women’s charity Eaves who “is surprised and saddened that illegal activities, crime, abuse, suffering and violence would be considered as part of the GDP”. She highlights the disturbing side of these financial evaluations based on “human tragedy”. Crime Prevention Minister Norman Baker has been trying to justify the reform: he explained that the reform will not encourage people to use drugs or to put themselves in jeopardy and that the laws are still effective. Prostitution will never be encouraged.

Gabrielle BENZIMRA & Louis-Van VU-NGOC

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