Many of the existing formal economic analyses of money laundering have sought to quantify the extent of money laundering, rather than qualify its effects on individual economies or groups of economies.
•damages the financial-sector institutions that are critical to economic growth;
•reduces productivity in the economy's real sector by diverting resources and encouraging crime and corruption, which slow economic growth;
•distorts the economy's external sector—international trade and capital flows to the detriment of longterm economic development.
Effective anti-money-laundering policies reinforce a variety of other good governance policies that help sustain economic development, particularly through the strengthening of the financial sector.
(From summary of ADB Paper, B Bartlett, 2002)