Chicago’s Underground Economy


There’s an absolutely fascinating article in Slate today about a new book called Off The Books: The Underground Economy of the Urban Poor, by Sudhir Venkatesh.

Amateur and professional economists alike may remember Venkatesh from a cameo in the much-lauded (and, in my humble opinion, highly overrated) Freakonomics– he’s the guy that decides that in order to understand and write about the urban poor he must not only study them, he must basically live amongst them, and proceeds to practically move into a poor South Side neighborhood to “hangs out” with the locals in order to gain their trust and to understand their stories.

Here’s an excerpt from the Slate article that definitely piqued my interest:

“Licit and illicit economies tend to be entwined, and in a closely knit urban neighborhood, this mutual dependence means that public-minded civilians and hardened criminals are regularly forced to negotiate. In the spring of 2000, an entrepreneurial gang leader, Big Cat, was elevating the criminal activity in a local park. Marlene and a preacher, Pastor Wilkins, arranged a tense summit with the kingpin in a church basement. Venkatesh talked his way into the room and watched as Big Cat agreed to stop peddling drugs in the park during after-school hours. For this concession, Pastor Wilkins promised to persuade a nearby store owner to allow Big Cat’s gang to deal in his parking lot, and Marlene agreed to ask the cops to leave the dealers unmolested in their new location.

“I can’t figure out who’s crazier,” Big Cat chuckles, once the deal is struck. “Me, or you niggers.”

(FYI, per the article, the names in the book have been changed to protect the innocent and guilty alike)

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