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Does Legalized Prostitution Increase Human Trafficking?

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  • Cho, Seo-Young
  • Dreher, Axel
  • Neumayer, Eric

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.

Suggested Citation

  • Cho, Seo-Young & Dreher, Axel & Neumayer, Eric, 2013. "Does Legalized Prostitution Increase Human Trafficking?," World Development, Elsevier, vol. 41(C), pages 67-82.
  • Handle: RePEc:eee:wdevel:v:41:y:2013:i:c:p:67-82
    DOI: 10.1016/j.worlddev.2012.05.023
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    Cited by:

    1. Niklas Potrafke, 2016. "Policies against human trafficking: the role of religion and political institutions," Economics of Governance, Springer, vol. 17(4), pages 353-386, November.
    2. Caruso, Raul, 2014. "What is the relationship between unemployment and rape? Evidence from a panel of European regions," MPRA Paper 54725, University Library of Munich, Germany.
    3. Seo-Young Cho, 2015. "Measuring Anti-Trafficking Policy—Integrating Text and Statistical Analyses," Social Science Quarterly, Southwestern Social Science Association, vol. 96(2), pages 656-683, June.
    4. Seo-Young Cho, 2015. "Does Prostitution Constrain Sex Crimes? Micro-evidence from Korea," MAGKS Papers on Economics 201521, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    5. Masahiro Shoji & Kenmei Tsubota, 2018. "Sexual Exploitation of Trafficked Children: Evidence from Bangladesh," Working Papers 175, JICA Research Institute.
    6. Paul Bisschop & Stephen Kastoryano & Bas van der Klaauw, 2017. "Street Prostitution Zones and Crime," American Economic Journal: Economic Policy, American Economic Association, vol. 9(4), pages 28-63, November.
    7. Niklas Potrafke, 2015. "The Evidence on Globalisation," The World Economy, Wiley Blackwell, vol. 38(3), pages 509-552, March.
    8. Seo-Young Cho, 2012. "Modeling for Determinants of Human Trafficking," Ibero America Institute for Econ. Research (IAI) Discussion Papers 216, Ibero-America Institute for Economic Research.
    9. Jakobsson, Niklas & Kotsadam, Andreas, 2015. "The Economics of Trafficking for Sexual Exploitation," Memorandum 07/2015, Oslo University, Department of Economics.
    10. Sonnabend, Hendrik, 2015. "Good Intentions and Unintended Evil? Clients’ Punishment in the Market for Sex Services with Voluntary and Involuntary Providers," EconStor Preprints 110682, ZBW - German National Library of Economics.
    11. Seo-Young Cho, 2016. "Liberal coercion? Prostitution, human trafficking and policy," European Journal of Law and Economics, Springer, vol. 41(2), pages 321-348, April.
    12. Seo-Young Cho, 2015. "Human Trafficking, A Shadow of Migration - Evidence from Germany," Journal of Development Studies, Taylor & Francis Journals, vol. 51(7), pages 905-921, July.
    13. Seo-Young Cho, 2015. "Modeling for Determinants of Human Trafficking: An Empirical Analysis," Social Inclusion, Cogitatio Press, vol. 3(1), pages 2-21.
    14. Hernandez, Diego & Rudolph, Alexandra, 2011. "Modern Day Slavery: What Drives Human Trafficking in Europe?," Proceedings of the German Development Economics Conference, Berlin 2011 83, Verein für Socialpolitik, Research Committee Development Economics.
    15. Majeed, Muhammad Tariq & Malik, Amna, 2017. "Selling Souls: An Empirical Analysis of Human Trafficking and Globalization," MPRA Paper 88850, University Library of Munich, Germany.
    16. Diego Hernandez & Alexandra Rudolph, 2011. "Modern Day Slavery: What Drives Human Trafficking in Europe?," Courant Research Centre: Poverty, Equity and Growth - Discussion Papers 97, Courant Research Centre PEG, revised 23 Nov 2011.
    17. Peter Egger & Andreas Lindenblatt, 2015. "Endogenous risk-taking and physical appearance of sex workers," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 16(9), pages 941-949, December.
    18. Hernandez, Diego & Rudolph, Alexandra, 2015. "Modern day slavery: What drives human trafficking in Europe?," European Journal of Political Economy, Elsevier, vol. 38(C), pages 118-139.
    19. Prakash, Nishith & Vadlamannati, Krishna Chaitanya, 2014. "Girls for Sale? Child Sex Ratio and Girls Trafficking in India," IZA Discussion Papers 8293, Institute for the Study of Labor (IZA).
    20. Boxell, Levi, 2016. "A Drought-Induced African Slave Trade?," MPRA Paper 69853, University Library of Munich, Germany.
    21. Scott Cunningham & Manisha Shah, 2014. "Decriminalizing Indoor Prostitution: Implications for Sexual Violence and Public Health," NBER Working Papers 20281, National Bureau of Economic Research, Inc.
    22. Seo-Young Cho, 2012. "Integrating Equality: Globalization, Women's Rights, and Human Trafficking," Economics of Security Working Paper Series 69, DIW Berlin, German Institute for Economic Research.

    More about this item

    Keywords

    human trafficking; prostitution; crime; scale effect; substitution effect; global;

    JEL classification:

    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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