Hacker News Reader

Comment by tonyhart7 | Hacker News Reader

their business is scam center that by definition is not counted by GDP anyway

That’s not necessarily true, though may be for Cambodia. GDP can include black market activities but countries differ in whether they include specific ones and how.

Right, it's not black market if you eventually pay some taxes on it somewhere. Dare we call it washed money, and for our American friends in the audience, laundered money.

as a pedantic aside Americans use the term washed or washing money interchangeably with laundering or laundered money

Laundering the proceeds from a black market transaction doesn't make the black market transaction not a black market transaction.

Does it even count in there though? Fraud isn't a normal transaction. It's the same as theft, which is simply a transfer from one person to another. An act of fraud or theft doesn't represent creation of value the way profit from legitimate transactions do for "black market" goods/services (even if the goods/services are illegal).

If we're just talking about the formula of GDP = gov spend + investment + consumption + net exports, then scamming foreigners would be captured under the "net exports" category. Similar to remittances, which are quite significant components of GDP for some countries.

Admittedly it's doubtful whether this kind of activity would be captured by official statistics.

Remittances aren't counted towards GDP either. The funds can contribute indirectly, as consumption or investment, if spent locally. This $15B didn't make it that far, though.

That’s a good point, transferring of assets isn’t counted - although if it’s imports perhaps that’s different. The cost of scamming may be counted, paying people to perform scams certainly could be depending on the type of calculation you do.

I know it’s a bit of a get out clause but it’s at least not obvious to me that this wouldn’t contribute, certainly the illegal nature is not a blocker for being counted in GDP.

There are countries that count illegal activities in their GDP estimates.

And should their state sponsored criminal activities count for North Korean GDP for example?

That money would have flowed somewhere, also I'm not sure OP was talking about impacting the GDP just quantizing it. For Cambodia, it's an extraordinary amount of money. Actually for anywhere it's a ridiculous amount of money.

Which makes it worse. A scamming operation that is 1/3 of the GDP is huuuuuuge.

It’s apples to oranges really. You confuse turnover with capital here.

I know the comparison is not correct but lets you see the magnitude of the operation.

Reply on news.ycombinator.com