Shadow Economy, Real-World Costs

What if one out of every four dollars in the global economy moves in the dark? We pull back the curtain on the shadow economy—its staggering size, where it thrives, and why it quietly reshapes taxes, wages, prices, and trust. From cash-only construction crews and informal hospitality work to trillion-dollar counterfeit flows, we connect the macro numbers to everyday choices that erode margins for honest firms and endanger consumers. We ground the conversation with region-by-region clarity: the UK at roughly 9 to 12 percent, the US around 11 to 12 percent, the EU ranging from 10 to 30 percent, and major players like China and Russia with distinct drivers and consequences. Then we dive into the sectors most exposed—construction, agriculture, domestic services, street retail, transport—and examine how counterfeit markets hit fashion, electronics, pharma, cosmetics, and auto parts. The throughline is simple and stark: the black economy distorts market signals, drains tax revenues, undermines worker protections, and funnels hidden risks into legitimate supply chains. This episode focuses on action. We outline how enhanced due diligence, supplier validation, digital audit trails, and brand protection strategies can reduce exposure. We discuss platform governance, cross-border cooperation, and why serialization and product verification tools are becoming non-negotiable. Crypto enters the frame as both a challenge and an analytical opportunity, raising hard questions about enforcement, fairness, and the real cost of “cheap” goods. If you lead a business, manage suppliers, or care about the integrity of what you buy, this is a pragmatic guide to navigating a market where visibility is power. If this resonated, follow the show, share it with a colleague, and leave a review so more people can find it. Your insights help shape future episodes—what risks are you seeing on the ground? Send us a text Support the show THANKS FOR LISTENING PLEASE SUPPORT THE SHOW You can support the podcast by following the link here. It makes a big difference and helps us make great content for you to listen to. Follow like and share the Chain Reaction Podcast with colleagues and friends on social media: Facebook, Twitter, LinkedIn. News about forthcoming programmes click here SHARE Please share the link with others so they can listen too https://chainreaction.buzzsprout.com/share LET US KNOW If you have any comments, suggestions or questions then just direct message on Linkedin or X (Twitter) REVIEW AND RATE If you like the show please rate and review it. Every vote helps. About Tony Hines and the Chain Reaction Podcast – All About Supply Chain Advantage I have been researching and writing about supply chains for over 25 years. I wrote my first book on supply chain strategies in the early 2000s. The latest edition is published in 2024 available from Routledge, Amazon and all good book stores. Each week we have special episodes on particular topics relating to supply chains. We have a weekly news round up every Saturday at 12 noon...