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Journal ArticleDOI

The law and economics of international sex slavery: prostitution laws and trafficking for sexual exploitation

TL;DR: In this paper, the authors show that trafficking of persons for commercial sexual exploitation (as proxied by the data sets they are using) is least prevalent in countries where prostitution is illegal, most prevalent in country where prostitution was legalized, and in between in those countries that prostitution is legal but procuring illegal.
Abstract: International trafficking in humans for sexual exploitation is an economic activity driven by profit motives. Laws regarding commercial sex influence the profitability of trafficking and may thus affect the inflow of trafficking to a country. Using two recent sources of European cross country data we show that trafficking of persons for commercial sexual exploitation (as proxied by the data sets we are using) is least prevalent in countries where prostitution is illegal, most prevalent in countries where prostitution is legalized, and in between in those countries where prostitution is legal but procuring illegal. Case studies of two countries (Norway and Sweden) that have criminalized buying sex support the possibility of a causal link from harsher prostitution laws to reduced trafficking. Although the data do not allow us to infer robust causal inference, the results suggest that criminalizing procuring, or going further and criminalizing buying and/or selling sex, may reduce the amount of trafficking to a country.

Summary (1 min read)

1 INTRODUCTION:

  • Human hookworm infestation is caused by blood-feeding nematode parasites of the species Ancylostoma duodenale and Necator americanus.
  • This disease occurs in all countries with a hot and wet climate.
  • According to the World Health Organization, 740 million people are infested by this parasitosis.
  • Hook-worms are among the most prevalent causes of mother & child morbidity in the tropical and subtropical regions of developing countries [3].

3 RESULTS:

  • Boys were slightly more infected than girls but the differ-ence was not significant.
  • Also, no significant difference was noted between the 28 infested children according to their age or sex (Table 2) A. duodenale was noted in 14.3% of infested children, N. americanus in 46.4% and both nema-todes in 39.3% (Table 2) The highest number of infected children (7 cases) was noted in Nkouampouer village, while the lowest (1case), was recorded in Koumbizik.
  • No infested child was diagnosed in Bikoka.
  • In the infested children, the following clinical manifestations were noted: abdominal pain (6 children), anaemia (4), pruritus (4), diarrhoea (3), and vomiting (2).

4 DISCUSSION:

  • In the present study, N. americanus was the dominant species, either solely, or in association with A. duodenale.
  • This finding agreed with the current knowledge of hookworm infestations in Africa [7] [8] [9].
  • The presence of A. duodenale confirms the reports of [8].
  • Adenusi and Ogunyomi (2003) in Nigeria and suggests that this species would be more widespread in Central Africa than expected.

5 CONCLUSION:

  • Both nematode species were found in the stools of school children from the Lolodorf health district, with the predominance of N. americanus over A duodenale.
  • The low values noted for prevalence and parasitic load of these hookworm infestations were probably due to MDA campaigns implemented by Cameroonian MOH.
  • The authors declare that they have no competing interest Authors’ contributions: MSR planned the study design; KPH and NL performed field activities; PKH and SJ performed laboratory investigation; DJFF drafted the manuscript; all authors read and approved the final manuscript.
  • The study was authorized by the “Institutional Review Board of the “Université des Montagnes” (No. 2015/45), the Lolodorf divisional officer, the Chief Medical Officer for the Lolodorf health district and the divisional primary school inspector.
  • In addition, clinical examination of schoolchildren and collection of their stool samples were carried out with the approval of headmasters and teachers.

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Department of Economics
School of Business, Economics and Law at University of Gothenburg
Vasagatan 1, PO Box 640, SE 405 30 Göteborg, Sweden
+46 31 786 0000, +46 31 786 1326 (fax)
www.handels.gu.se info@handels.gu.se
WORKING PAPERS IN ECONOMICS
No 458
The Law and Economics
of International Sex Slavery:
Prostitution laws and trafficking
for sexual exploitation
Niklas Jakobsson and Andreas Kotsadam
June 2010
ISSN 1403-2473 (print)
ISSN 1403-2465 (online)

1
The Law and Economics of International Sex Slavery:
Prostitution Laws and Trafficking for Sexual Exploitation
Niklas Jakobsson and Andreas Kotsadam
Abstract
Trafficking in humans for sexual exploitation is an economic activity driven by profit motives. Laws
regarding commercial sex influence the profitability of trafficking. Using cross country data we show
that trafficking of persons for commercial sexual exploitation is least prevalent in countries where
prostitution is illegal, most prevalent in countries where prostitution is legalized, and in between in
those countries where prostitution is legal but procuring illegal. Case studies of countries that have
changed legal framework support the claims on the direction of causality as well as the causal
mechanisms. The results suggest that criminalizing buying and/or selling sex may reduce the amount
of trafficking to a country.
Keywords: law and economics, prostitution, sexual exploitation, sex slavery, trafficking
JEL classification: F22, K14
Norwegian Social Research (NOVA) and University of Gothenburg, Sweden, Box 640, SE-405 30, Gothenburg,
Sweden. Phone: 0047 40338176. Fax: 0047 22541201. E-mail: andreas.kotsadam@economics.gu.se.

2
Introduction
International human trafficking of women for commercial sexual exploitation (henceforth
trafficking) has been identified as a form of modern day slavery and it is a worldwide problem which
has grown rapidly in the last decades (Bettio and Nandi forthcoming; Hodge and Leitz 2007). Up to
4 000 000 people are estimated to be exploited by human traffickers each year (UNHCR 2006).
According to the European Commission (2009) trafficking in human beings is a serious crime and a
gross violation of human rights and to reduce trafficking in human beings is highly prioritized in
many countries.
Governments throughout the world view human trafficking as a component of organized crime and
the average punishment for trafficking of humans is comparable to other types of serious
transnational crimes (Morrison and Crosland 2001). It is also regarded as a crime against humanity in
the statute of the International Criminal Court (Article 7.2). People are trafficked for the purpose of
sexual or labour exploitation and it is estimated that 87 % of the trafficking is for sexual exploitation
(UNODC 2006).
1
Trafficking in human beings for sexual purposes is intimately linked to organised
crime and is considered the second source of illicit profits for organised crime (European
Commission 2009). In this study we investigate if there is a relation between national prostitution
legislation and trafficking into a country.
Trafficking is an economic activity in which organizations try to make profits (Salt 2000; Salt and
Stein 1997). Traffickers will only sell persons for sexual exploitation when the market conditions
make it profitable (UNODC 2009). Evidence suggests that human traffickers belong to organized
criminal organizations and that they act as businessmen trying to maximize profits (e.g. Anderson
and O‟Conell Davidson 2002; Hodge and Leitz 2007; Salt 2000; UNODC 2006; UNODC 2009).
The profitability of trafficking to a given country hinges on the characteristics of the national market
for commercial sex. A crucial factor for the profitability of commercial sex is the legal framework
surrounding it. Aghatise (2004) argues that it is impossible to combat trafficking where prostitution is
sanctioned. This is also the position taken by several governments and it has been an explicit
motivation for criminalization of buying sex in Norway (Ot.prp. nr.48) and Sweden (Proposition
1
The figures on the share of sexual exploitation should be taken with care though, since sexual exploitation is argued to
be more visible than forced labor (UNODC 2009).

3
1997/98:55) and the U.S. Government took a strong position against legalized prostitution using this
argument (U.S. Department of State 2004). Using the fact that national prostitution legislation differs
considerably between countries the aim of this paper is to test the hypothesis that harsher legislation
on commercial sex reduces the amount of trafficking to a country.
The economics literature on prostitution is still sparse, although it has grown some in recent years
(e.g. Cameron et al. 1999; Edlund and Korn 2002; and Albert et al. 2007). Available studies have
mainly focused on pricing, and more exactly on pricing as a reflection of risk preferences (Cameron
and Collins 2003; Rao et al. 2003; Moffat and Peters 2004; Gertler et al. 2005; Levitt and Venkatesh
2007; and Raj and Shah 2008). Della Giusta (forthcoming) further builds on the prostitution model
of Della Giusta et al. (2008 and 2009) and incorporates the role of stigma and reputation for policy
decisions as well. Jakobsson and Kotsadam (2010a) study attitudes toward prostitution in the general
population, and also investigate if a recent criminalization of buying sex in Norway changed public
attitudes (Jakobsson and Kotsadam 2010b).
The economics literature on trafficking for sexual exploitation is even sparser. Della Giusta et al.
(2008) use survey data from the International Organization for Migration (IOM), the Counter-
Trafficking Module Database, to study victims of trafficking for sexual exploitation. Of the 5117
females in the sample, 89 percent was trafficked for sexual exploitation. The countries of origin of
these women were Eastern Europe and ex-Soviet states. Their salary before being trafficked was
USD 52 per month, the amount they were being sold for was about USD 4659 per month. 84
percent were recruited via personal contacts, TV and internet advertising accounted for 7 percent, 5
percent were kidnapped and 1 percent sold by their family. Also using the IOM data, Bettio and
Nandi (forthcoming) investigate which factors influence the violation of basic rights (physical
integrity, to move freely, to have access to medical care, to use condoms, and to exercise choice over
sexual services) among trafficked women. They find that working location and country of work are
the main determinants of rights enforcement, while individual and family characteristics play a
marginal role.
There is one former study trying to evaluate the effect of national prostitution legislation on
trafficking (Di Nicola et al. 2005). Studying official victim data from eleven EU countries they argue
that leaner prostitution legislation may cause more trafficking victims. This conclusion is, however,

4
drawn from a very small sample (11 countries) and from descriptive statistics. Danailova-Trainor and
Besler (2006) study what determines trafficking flows. Using country level estimates of trafficking
victim data they find that countries that are more open to globalization and countries with more
prostitution are more likely to be destination places for trafficking victims.
Using both the trafficking database constructed by the United Nations Office on Drugs and Crime
and data from the ILO, as well as information about national prostitution legislation, we investigate
if there is a relation between prostitution legislation and the prevalence of trafficking to a country. In
accordance with our theoretical predictions we find that trafficking of women for commercial sexual
exploitation is least prevalent in countries where prostitution is illegal, most prevalent in countries
where prostitution is legalized, and in between in those countries where prostitution is legal but
procuring illegal. We then proceed to investigate two cases of legal change and its effect on
trafficking. The hypothesis of reduced trafficking from harsher laws is confirmed as well as the
theoretical mechanisms.
The remainder of the paper is organized as follows. Section 2 discusses human trafficking and
prostitution. Section 3 presents the theoretical mechanisms. Section 4 describes the data and
descriptive statistics, while Section 5 considers the empirical framework and results. Section 6
includes the case studies and Section 7 concludes.
Human trafficking for sexual exploitation and prostitution
Up to 4 000 000 people are estimated to be exploited by human traffickers each year (UNHCR
2006). Trafficking is intimately linked to organized crime and the United Nations estimate that
criminal groups earn approximately 7 billion US dollars a year on trade with people. According to the
European Commission (2009) trafficking in human beings is a serious crime and a gross violation of
human rights and combating it is a priority for many countries. It has been difficult to reach a
consensus on how to define trafficking and it was not until the year 2000 that the UN General
Assembly adopted a common definition, referred to as the Palermo Protocol, which defines
trafficking as: “„Trafficking in persons‟ shall mean the recruitment, transportation, transfer,
harbouring or receipt of persons, by means of the threat or use of force or other forms of coercion,
of abduction, of fraud, of deception, of the abuse of power or of a position of vulnerability or of the
giving or receiving of payments or benefits to achieve the consent of a person having control over

Citations
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TL;DR: In this article, the authors investigate the impact of legalized prostitution on human trafficking inflows and show that the scale effect dominates the substitution effect, leading to an expansion of the prostitution market, increasing human trafficking and reducing demand for trafficked women.
Abstract: This paper investigates the impact of legalized prostitution on human trafficking inflows. According to economic theory, there are two opposing effects of unknown magnitude. The scale effect of legalized prostitution leads to an expansion of the prostitution market, increasing human trafficking, while the substitution effect reduces demand for trafficked women as legal prostitutes are favored over trafficked ones. Our empirical analysis for a cross-section of up to 150 countries shows that the scale effect dominates the substitution effect. On average, countries where prostitution is legal experience larger reported human trafficking inflows.

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Cites background or methods from "The law and economics of internatio..."

  • ...…that it is “difficult, perhaps impossible, to find hard evidence” of a relationship between trafficking and any other phenomenon (Cho et al. 2012, p. 70) and that “the underlying data may be of bad quality” and are “limited and unsatisfactory in many ways” ( Jakobsson & Kotsadam 2013, p. 93)....

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  • ...Using information on 161 countries from the UN’s Office on Drugs and Crime (UNODC), Cho et al. (2012) and Jakobsson & Kotsadam (2013) attempted to determine whether national prostitution laws are related to the prevalence of human trafficking....

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References
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TL;DR: In fact, some common properties are shared by practically all legislation, and these properties form the subject matter of this essay as discussed by the authors, which is the basis for this essay. But, in spite of such diversity, some commonsense properties are not shared.
Abstract: Since the turn of the twentieth century, legislation in Western countries has expanded rapidly to reverse the brief dominance of laissez faire during the nineteenth century. The state no longer merely protects against violations of person and property through murder, rape, or burglary but also restricts ‘discrimination’ against certain minorities, collusive business arrangements, ‘jaywalking’, travel, the materials used in construction, and thousands of other activities. The activities restricted not only are numerous but also range widely, affecting persons in very different pursuits and of diverse social backgrounds, education levels, ages, races, etc. Moreover, the likelihood that an offender will be discovered and convicted and the nature and extent of punishments differ greatly from person to person and activity to activity. Yet, in spite of such diversity, some common properties are shared by practically all legislation, and these properties form the subject matter of this essay.

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TL;DR: To understand the central claims of evolutionary psychology the authors require an understanding of some key concepts in evolutionary biology, cognitive psychology, philosophy of science and philosophy of mind.
Abstract: Evolutionary psychology is one of many biologically informed approaches to the study of human behavior. Along with cognitive psychologists, evolutionary psychologists propose that much, if not all, of our behavior can be explained by appeal to internal psychological mechanisms. What distinguishes evolutionary psychologists from many cognitive psychologists is the proposal that the relevant internal mechanisms are adaptations—products of natural selection—that helped our ancestors get around the world, survive and reproduce. To understand the central claims of evolutionary psychology we require an understanding of some key concepts in evolutionary biology, cognitive psychology, philosophy of science and philosophy of mind. Philosophers are interested in evolutionary psychology for a number of reasons. For philosophers of science —mostly philosophers of biology—evolutionary psychology provides a critical target. There is a broad consensus among philosophers of science that evolutionary psychology is a deeply flawed enterprise. For philosophers of mind and cognitive science evolutionary psychology has been a source of empirical hypotheses about cognitive architecture and specific components of that architecture. Philosophers of mind are also critical of evolutionary psychology but their criticisms are not as all-encompassing as those presented by philosophers of biology. Evolutionary psychology is also invoked by philosophers interested in moral psychology both as a source of empirical hypotheses and as a critical target.

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Abstract: This paper reports on the 2009 update of the Worldwide Governance Indicators (WGI) research project, covering 212 countries and territories and measuring six dimensions of governance between 1996 and 2008: Voice and Accountability, Political Stability and Absence of Violence/Terrorism, Government Effectiveness, Regulatory Quality, Rule of Law, and Control of Corruption. These aggregate indicators are based on hundreds of specific and disaggregated individual variables measuring various dimensions of governance, taken from 35 data sources provided by 33 different organizations. The data reflect the views on governance of public sector, private sector and NGO experts, as well as thousands of citizen and firm survey respondents worldwide. The authors also explicitly report the margins of error accompanying each country estimate. These reflect the inherent difficulties in measuring governance using any kind of data. They find that even after taking margins of error into account, the WGI permit meaningful cross-country comparisons as well as monitoring progress over time. The aggregate indicators, together with the disaggregated underlying indicators, are available at www.govindicators.org.

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"The law and economics of internatio..." refers background in this paper

  • ...Trafficking is an economic activity in which organizations try to make profits (Salt and Stein 1997; Salt 2000)....

    [...]

  • ...Trafficking is an economic activity in which organizations try to make profits ( Salt and Stein 1997; Salt 2000)....

    [...]

Frequently Asked Questions (11)
Q1. What are the contributions in "The law and economics of international sex slavery: prostitution laws and trafficking for sexual exploitation" ?

Using cross country data the authors show that trafficking of persons for commercial sexual exploitation is least prevalent in countries where prostitution is illegal, most prevalent in countries where prostitution is legalized, and in between in those countries where prostitution is legal but procuring illegal. Case studies of countries that have changed legal framework support the claims on the direction of causality as well as the causal mechanisms. The results suggest that criminalizing buying and/or selling sex may reduce the amount of trafficking to a country. 

Acknowledging that trafficking for sexual exploitation is an economic activity driven by profit motives and that state action and inaction is decisive for structuring profit possibilities the authors develop theoretical predictions. This suggests that harsher prostitution legislation may reduce the amount of trafficking to a country. 

Since deception of migrants is common, and since there are fixed costs in establishing migration routes the authors argue that increased immigration to a country reduces the costs of trafficking. 

Policies that increase stigmatization of clients are expected to reduce the marginal willingness to pay, the quantity sold, and the equilibrium price. 

Human trafficking for sexual exploitation and prostitutionUp to 4 000 000 people are estimated to be exploited by human traffickers each year (UNHCR 2006). 

In Denmark at least half of the prostitutes (between 5500 and 7800) are said to be victims of trafficking and Finnish criminal intelligence estimate that between 10 000 and 15 000 women are trafficked there each year. 

It is likely to affect the supply of trafficked women directly by increasing costs of the day to day prostitution since street prostitution is not viable which imposes costly discretion. 

The number of buyers is said to have decreased by as much as 75 % to 80 % and the number of women in street prostitution is said to be only 500 in Sweden, whereas in Denmark, where prostitution is legal, it is up to 7800 (and Denmark has only half of the Swedish population). 

victim testimonies have shown that traffickers prefer to operate in countries where prostitution is tolerated or legalized and the Latvian police have concluded that Latvian traffickers avoid Sweden due to the effect the Swedish law has on the profitability of their business (Ekberg 2006). 

these indicators measure the success of a society in developing an environment in which fair and predictable rules form the basis for economic and social interactions and the extent to which property rights are protected. 

If a country goes from a situation where buying and/or selling sex is illegal to a situation where prostitution is legal and regulated (from 1 to 3 on the Law variable), the probability that it will score High or Very high on the trafficking index increases by 68 percent (62 percent in Specification 2). 

Trending Questions (1)
Does legalized prostitution increase human trafficking?

The paper suggests that countries where prostitution is legalized have higher prevalence of human trafficking for sexual exploitation, indicating a possible link between legalized prostitution and increased trafficking.