Georgy V. Peschanskikh
This article comprehends the economics of underground alcoholic beverage production and sales. The likelihood of detection by government agencies is determined for individual components of this criminal enterprise, and the costs incurred by criminal organizations to prevent adverse developments are discussed. The position of underground producers in the legal alcoholic beverage market is explored. Approaches to pricing and determining production volumes for illegal alcohol are presented. It is concluded that criminal organizations possess significant opportunities to increase profits, compete with competitors for price, and capture new markets. An examination of the ways in which legal enterprises are used in criminal enterprises reveals a "flow" of funds from the legal to the criminal sector of the economy, the degradation of legal enterprises, and the reproduction of criminal relations. Based on the relationship between the costs of criminal organizations and the risks of their activities, proposals are formulated for government agencies to focus their efforts on the most costly stages of their activities — joint operations involving entities from the legal and illegal sectors of the economy. The opinion has been formulated that the signs of such joint operations are the absence of economic feasibility or business logic in the behavior of a legal enterprise, and unmotivated “mistakes” of managers, leading to a decrease in the economic performance of legal enterprises.