More Bang For The Buck

Technology has changed many things in our lives. Here's an interesting example of how technology has impacted the world's oldest profession.

Prostitution and the internet

For those seeking commercial sex in Berlin, Peppr, a new app, makes life easy. Type in a location and up pops a list of the nearest prostitutes, along with pictures, prices and physical particulars. Results can be filtered, and users can arrange a session for a €5-10 ($6.50-13) booking fee.

Other apps allow prostitutes to create online profiles so customers can browse the listings, or post reviews of their experiences. Just like other sites that provide information on more traditional services (e.g., TripAdvsior), these sites collect and aggregate data for further analysis.

The wealth of data available online means it is now possible to analyse this larger and less examined part of the commercial-sex market: prostitution that happens indoors. It turns out to be surprisingly similar to other service industries. Prostitutes’ personal characteristics and the services they offer influence the prices they charge; niche services attract a premium; and the internet is making it easier to work flexible hours and to forgo a middleman.

The Economist has analyzed 190,000 online reviews of sex workers. The article goes into great detail regarding the data and its implications. If the subject matter doesn't offend you it's quite interesting. For example, prices have dropped since 2006. Some of that is attributed to the 2007-2008 economic downturn, but other factors that I never would have thought of affect prices. For example, population migration, especially in the EU (the movement of immigrants from poorer Eastern European countries to more prosperous nations such as England and Germany) has a downward influence. Not only are the immigrants generally willing to work for less (this is true in many industries, not just prostitution) but the newcomers are often inexperienced and tend to underprice themselves.

Technology itself has contributed to falling prices by facilitating the entry of a new cohort of sex workers, and enabling greater competition from amateurs.

The shift online has probably boosted supply by drawing more locals into the sex trade, too. More attractive and better-educated women, whose marital and job prospects are therefore better, are more likely to consider sex work if it is arranged online. Indoor sex work is safer than streetwalking, and the risk of arrest is lower. Rented flats or hotel rooms are more discreet than brothels, so family and friends are less likely to identify the new source of income. Anonymity becomes a possibility, which lessens the fear of stigma ... Free, no-strings-attached sex is far easier to find than in the past. Apps such as Tinder facilitate speedy hookups; websites such as Ashley Madison and Illicit Encounters, adulterous ones.

(Click to embiggen.)

A surprising finding was that in the sex industry, just like in the corporate world, a college degree pays off.

A degree appears to raise earnings in the sex industry just as it does in the wider labour market. A study by Scott Cunningham of Baylor University and Todd Kendall of Compass Lexecon, a consultancy, shows that among prostitutes who worked during a given week, graduates earned on average 31% more than non-graduates.

Drilling down deeper into the data, we find that gentlemen really do prefer blondes - particularly well-endowed ones with long hair.

(Click to embiggen.)

Given all the unrest currently taking place in Ferguson MO, I hesitate to post this next chart. You can draw your own conclusions from it.

(Click to embiggen.)

Technology also helps improve safety and 'working conditions' for sex workers.

Sex work exposes those who do it to serious risks: of rape and other violence, and of sexually transmitted infections. But in this industry, like many others, the internet is making life easier.

Online forums allow prostitutes to share tips about how to stay safe and avoid tangling with the law. Some sites let them vouch for clients they have seen, improving other women’s risk assessments. Others use services such as Roomservice 2000, another American site, where customers can pay for a background check to present to sex workers.

In Britain, Ugly Mugs runs an online database that prostitutes can use to check punters’ names and telephone numbers. In America the National Blacklist, a “deadbeat registry”, allows them to report men who are abusive or fail to pay. Other women can check potential clients by names, telephone numbers, e-mail addresses and online aliases. Though not specifically aimed at sex workers, apps such as Healthvana make it easy for buyer and seller to share verified results in sexual-health tests.

The article is lengthy, but intriguing. It offers an insightful examination into the ripple effect of innovation, and the interplay between economics and technology. Set aside a few minutes and give it a read. I think you'll find in interesting.

I'm sure this is what Al Gore had in mind when he invented the Internet...