A relief work in Amsterdam's Oudekerksplein. Photo: J.M. Luijt (cc)
Economics isn't about money. It's about understanding how people make decisions about what they do. This is as true in the movie Trading Places, an apparently very accurate depiction of commodity trading, as it is in sex work, an industry that has at various times and in various cultures been treated as a sin to be stamped out—or a service.
Charles Hill, a business school professor at the University of Washington in Seattle, penned a recent blog entry looking at a change in local police tactics intended to reduce the demand for the service of sex workers. The stated change is to reduce demand for sex work by 20 percent by targeting johns who hire such services. But Dr. Hill starts from the increasingly validated position that most sex workers have personal agency, and haven't been coerced to pursue their trade.
Dr. Hill suggests that if sex workers are making a choice, then reducing demand side will paradoxically increase supply. He notes, if that supposition is true, "to them selling sex is a better economic option than their next best alternative, which might be waiting tables in a restaurant, working in a telephone call center, or subsisting on welfare."
Thus, reducing demand forces sex workers to drop their prices, requiring them to work more hours to achieve the same level of income, which increases supply. The lower price and greater availability provides an incentive for those considering purchasing sex services to enter the market. (He notes his model holds true where pimps are in control of 100 percent of sex workers, because pimps are then making a choice about maintaining a standard of living, and they force their workers to work longer hours.)
Dr. Hill also works out the model for a multi-tier sex-services market, which is likely closer to reality than a fungible one, in which all those offering the same services at the same price are interchangeable. In a tiered system, reputation systems (which exist for sex work as they do for restaurants) allow higher-priced sex workers to screen customers as well as vice-versa. Aggressive enforcement against customers of lower-tier sex work that lacks screening will not only decrease the price of services in that tier, but shift some clients to safer though more expensive alternatives, increasing the potential earning for escorts who have been reviewed online.
His understandable analysis, complete with charts, is a good read. But it is the humanity he brings that builds a more empathetic economics. He notes, in part,
What we should be asking is what is wrong with a contract to sell sexual services between consenting adults who enter voluntarily into the transaction, neither of whom is harmed by the exchange? Objectively speaking, the answer I would contend is nothing at all. No harm is done here, so why should this be regarded as a crime?
While this demand-side reduction might allegedly be being conducted to reduce coerced work and sex trafficking, Dr. Hill demonstrates that it offers no benefit to those sex workers in that situation; in fact, it puts them in a situation in which they must offer more services than before.
We see again that conservative aspects of society use morality as a tool to control sexuality, especially that of women, under the guise of providing a social good. And that the ways in which they exercise these tools consistently puts the weakest members of society at the greatest harm. A clear-sighted economic analysis suggests that specifically targeting pimps and traffickers, rather than clients and sex workers, and ignorning the consensually driven portion of the market, would produce something closer to the actual desired outcome.
(Thanks, Mistress Matisse!)
