Pacific Affairs: Guns Girls Gambling Ganja: Thailand's Illegal Economy and Public Policy

GUNS GIRLS GAMBLING GANJA: Thailand's Illegal Economy and Public Policy Ry Pasuk Phongpaichit, Sungsidh Piriyarangsan, and Nualnoi Treerat. Chiang Mai (Thailand): Silkworm Books (distributed by University of Washington Press, Seattle, WA. ) 1999. xi, 284 pp. (Tables. ) US$17.50, paper. ISBN 974-7100-75-4.

MOST COUNTRIES have an underground economy, often referred to as the shadow, informal or parallel economy. The income from these economic activities is usually beyond the reach of economists who tabulate business transactions or the grasp of assessors of personal and business taxes. The book under review is a wide-ranging examination of Thailand's illegal economy, that is centered around unlawful activities such drug trafficking, trading in contraband arms, smuggling of diesel oil, trafficking in labor (and prostitution), and illegal gambling.

The book's university based authors estimate that illegal activities amount to between 8-13 percent of Thailand's GDP between 1993-1995. Gambling and prostitution comprise the largest share of the underground economy and employs hundreds of thousands of Thais. Attempts are systematically made to recycle profits from illegal activities into the regular economy and the issue of money laundering is discussed in a separate chapter. The chapter on money laundering provides some insights into the difficulties that Southeast Asian nations, such as Thailand, face in introducing International Monetary Fund-mandated institutional reforms of the banking and financial sectors, in response to the economic crises of the late 1990s. It was also interesting to note that the unlawful economic activities in Thailand were connected with activities in neighboring Burma, Laos and Cambodia, perhaps indicating that these issues are regional in scope.

The book under review represents an extension of a 1994 study that studied the nexus between corruption and democracy in Thailand. That earlier work focussed on election campaign financing and the practice of "buying" prime bureaucratic positions. Substantial sums from the underground economy are channeled into political campaigns in Thailand, but it should be noted that campaign financing is a problematic issue in many democracies, whether it is Thailand, the United States, Israel or Germany, as recent media headlines attest. Aside from campaign financing, another concern of the authors is corruption. In return for payoffs, police officers (and politicians) either ignore the illegal activities or enforce laws selectively

The researchers rely on a variety of data sources, including: a,) knowledgeable informants, such as law enforcement officials and bureaucrats; b) field studies that provide estimates, for example, of the prevalence of gambling; c) opinion surveys; d) estimates based on the value of contraband seized by officials, such as arms and diesel oil; and e) official government statistics. The authors have painstakingly collated the available data but the book lacks a detailed discussion of the methodologies used, such as a description of the strengths and limitations of the data used in generating conclusions.

While the authors document the social and political impact of illegal activities, one other shortcoming of the book is the diffused discussion of public policy issues connected to the illegal economy The overwhelming impression given in this work is of widespread tolerance of these illegal activities within Thailand, especially of gambling and prostitution. In calling for police and political reforms, and how pressure for reforms must come from Thais, the book ends on what may be termed an uncertain note. Many questions remain unanswered. Are there instances where honest officials and politicians have tried to crack down on illegal activities? What has been the impact of these crackdowns? Why were attempts to legalize some activities, such as gambling (huay) thwarted? Can problems be tackled by just one national government given the regional scope of some issues?

Overall, this work should be considered a baseline examination of the underground economy in Thailand and should promote further research into this economic sector. This is a book that should be useful to scholars and general readers interested in Thailand and Southeast Asia.

Texas A&M University, College Station, Texas, U.S.A.

RAMDAS MENON