2. Outline  What is “System D”?  Background  Pricing  Size of black markets  Future prospects

3. What is “System D” ? System D = Underground economy Débrouillard – assertive, resourceful, sharp-witted

4. Background Underground economies :  illegal economy (black market)  unreported economy (grey market)

5. Pricing Goods acquired illegally take one of two price levels:  cheaper than legal market prices  more expensive than legal market prices.

6. Size of black markets Largest black marketsmarket value (bln, USD) Total1,829 Counterfeit Drugs200 Prostitution187 Counterfeit Electronics169 Marijuana142 Illegal Gambling140 Cocaine85 Prescription Drugs72,5 Heroin68 Software Piracy58,8 Movie Piracy58 Gas and Oil Smuggling54

7. Size of black markets

8. Underground Economy Value in Ukraine  Total Country Black Market Value: $4.310 bln  Total Country Grey Market Value: $199 bln

9. Future prospects  By 2020, the OECD* predicts the shadow economy will employ two-thirds of the world’s workers. *Organization for Economic Co-operation and Development, founded in 1961 to stimulate economic progress and world trade

10. "In this world there is nothing that is certain except death and taxes“ Benjamin Franklin