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Compensated for Life: Sex Work and Disease Risk

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  • Raj Arunachalam
  • Manisha Shah

Abstract

Sex workers draw a premium for engaging in unprotected sex. We theoretically motivate a test of whether this premium represents a compensating differential for disease, thereby mitigating sex workers’ propensity to use condoms. Using transaction-level data and biological STI markers from sex workers in Ecuador, we exploit within-worker variation across local disease environments. We find that locations with low disease prevalence exhibit a very low, insignificant premium for unprotected sex. A one percentage point increase in the local disease rate increases the premium for noncondom sex by 33 percent. Market forces may curb the self-limiting nature of STI epidemics.

Suggested Citation

  • Raj Arunachalam & Manisha Shah, 2013. "Compensated for Life: Sex Work and Disease Risk," Journal of Human Resources, University of Wisconsin Press, vol. 48(2), pages 345-369.
  • Handle: RePEc:uwp:jhriss:v:48:y:2013:ii:1:p:345-369
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    References listed on IDEAS

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    7. Adela de la Torre & Arthur Havenner & Katherine Adams & Justin Ng, 2010. "Premium sex: Factors influencing the negotiated price of unprotected sex by female sex workers in Mexico," Journal of Applied Economics, Universidad del CEMA, vol. 13, pages 67-90, May.
    8. Sarah Baird & Craig McIntosh & Berk Özler, 2011. "Cash or Condition? Evidence from a Cash Transfer Experiment," The Quarterly Journal of Economics, Oxford University Press, vol. 126(4), pages 1709-1753.
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    10. Rao, Vijayendra & Gupta, Indrani & Lokshin, Michael & Jana, Smarajit, 2003. "Sex workers and the cost of safe sex: the compensating differential for condom use among Calcutta prostitutes," Journal of Development Economics, Elsevier, vol. 71(2), pages 585-603, August.
    11. Lena Edlund & Evelyn Korn, 2002. "A Theory of Prostitution," Journal of Political Economy, University of Chicago Press, vol. 110(1), pages 181-214, February.
    12. Paul J. Gertler & Manisha Shah, 2011. "Sex Work and Infection: What's Law Enforcement Got to Do with It?," Journal of Law and Economics, University of Chicago Press, vol. 54(4), pages 811-840.
    13. Michael Lokshin & Martin Ravallion, 2008. "Testing for an economic gradient in health status using subjective data," Health Economics, John Wiley & Sons, Ltd., vol. 17(11), pages 1237-1259, November.
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    Cited by:

    1. 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.
    2. Manda, Constantine, 2013. "Bang for Your Buck: STI Risk and Pregnancy Risk as Sources of the Price Premium for Unprotected Sex," MPRA Paper 52864, University Library of Munich, Germany.
    3. Abel Brodeur & Warn N Lekfuangfu & Yanos Zylberberg, 2018. "War, Migration and the Origins of the Thai Sex Industry," Journal of the European Economic Association, European Economic Association, vol. 16(5), pages 1540-1576.
    4. Wilson, Nicholas, 2017. "The World’s Oldest Profession? Employment-Age Profiles from the Transactional Sex Market," GLO Discussion Paper Series 77, Global Labor Organization (GLO).
    5. Samuel Lee & Petra Persson, 2012. "Human Trafficking and Regulating Prostitution," Working Papers 12-07, New York University, Leonard N. Stern School of Business, Department of Economics.
    6. Matthew Quaife & Peter Vickerman & Shanthi Manian & Robyn Eakle & Maria A. Cabrera‐Escobar & Sinead Delany‐Moretlwe & Fern Terris‐Prestholt, 2018. "The effect of HIV prevention products on incentives to supply condomless commercial sex among female sex workers in South Africa," Health Economics, John Wiley & Sons, Ltd., vol. 27(10), pages 1550-1566, October.
    7. Brady, David W. & Biradavolu, Monica R. & Blankenship, Kim M., 2015. "Brokers and the Earnings of Female Sex Workers in India," EconStor Open Access Articles, ZBW - Leibniz Information Centre for Economics, pages 1123-1149.
    8. Lépine, Aurélia & Treibich, Carole, 2020. "Risk aversion and HIV/AIDS: Evidence from Senegalese female sex workers," Social Science & Medicine, Elsevier, vol. 256(C).
    9. Wilson, Nicholas & Janicki, Martha, 2016. "A cut above the rest? Private anthropometrics in marriage markets," Economics & Human Biology, Elsevier, vol. 23(C), pages 164-179.
    10. Manian, Shanthi, 2021. "Conflict and risky health behavior: Evidence from Mexico's drug war," Journal of Development Economics, Elsevier, vol. 148(C).
    11. Matthew Quaife & Fern Terris‐Prestholt & Zindoga Mukandavire & Peter Vickerman, 2021. "Modelling the effect of market forces on the impact of introducing human immunodeficiency virus pre‐exposure prophylaxis among female sex workers," Health Economics, John Wiley & Sons, Ltd., vol. 30(3), pages 659-679, March.

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