A Post-Keynesian Approach to Understanding the Black Economy

The aftermath of demonetisation witnessed several books engaging with the black economy. However, the seminal work on the black economy in the Indian context is Arun Kumar’s The Black Economy in India (1999). Saumen Chattopadhyay’s Macroeconomics of the Black Economy is an extension of his PhD thesis which significantly draws on Kumar (1999).

Chattopadhyay’s book is divided into six chapters. After outlining key concepts and definitions in Chapter 1, Chapter 2 undertakes a survey of the empirical literature on black economy. Chapters 3, 4, and 5 examine the effects of the black economy on the real sector, monetary sector, and open economy respectively. Chapter 6 appraises policies such as demonetisation, the goods and services tax (GST), and education. It ends with a discussion on the necessary features of a macro model for the Indian economy, perhaps in lieu of a concluding chapter.