Time and again, I have marveled at the stupid comments in the press about black markets and how they work. Those are not always as stupid as the comments by the “public health” people and other Drug Warriors, though the mainstream media does often just act as a transcriptionist for their claims.
As a general rule, illicit markets work just like any other markets: delivering a wanted good at a price that provides adequate profit, supply and demand, market clearing price, and all that. The major difference is that monopolies are often enforced with violence, which as with any monopoly situation, is bad for consumers (oh, and for the people who get shot too). Also, the consumers have to pay the risk premium to compensate the sellers for the risk of arrest and violence that they face.
But mostly, illicit markets are markets. Which was why today’s news from Canada was so funny. It turns out there was an astonishingly huge burglary of maple syrup from a Quebec warehouse. That part is not funny (other than the fact that the day’s top news from Canada is about maple syrup). What is funny is the headline that appeared in the NYT:
Canada: A Theft Casts a Pall Over Breakfast Plates
They seem to think that the theft of the syrup means that pancake eaters are going to be bereft of their beloved sugar. But what, exactly, do they think the thieves are going to do with their haul? Pour it into the Saint Lawrence River? Of course not. They have probably already sold it to maple syrup distribution networks, and someone is eating it right now.
Obviously there is a lot that is bad about this, most obviously including the fact that someone is making undeserved profit from the labors of others (you know, kind of like Wall Street, the Master Settlement Agreement, or lots of other organized criminal activity). But one thing that did not happen was the commodity disappearing from the world just because it was stolen.