Porn economics?

November 17, 2012
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(This article was originally published at Gianluca Baio's blog, and syndicated at StatsBlogs.)

Since it's Saturday and Marta is on holiday at IKEA with her mum, this morning I took it really easy [NB: wait until you read the whole thing, before you judge me from the title and the premise $-$ it's definitely not what it looks like!]. 

I had spot of breakfast, shaved, showered and then took a look at the newspapers. While I was reading the Guardian, I saw this article. I didn't know anything about this, but the gist of the story is that in addition to re-electing President Obama, earlier in November the people of California have also voted in favour of Measure B, a new law requiring the use of condoms in adult movies shot in LA County. 

The author of the article is Stoya, a "performer for adult production studio Digital Playground" [I thought of posting a link, but from her own profile in the Guardian's website, she "recommends that you refrain from googling her at work", and so I thought better not]. Her argument against the new law is that the porn industry has not seen a single case of performer-to-performer HIV transmission in the last 8 year (which I suppose it's impressive). On the other hand, there is some evidence that movies in which the performers wear condoms are less well received by the audience, leading to a drop in sales. This, she continues, will have an effect on the whole industry; at the moment, the performers are continuously tested for STDs (including HIV), which of course is quite expensive. Thus, if the industry's profits are reduced further (in addition to the losses inflicted by piracy, mostly on the web), this will lead to fewer performers being tested and thus potentially producing unintended negative effects.

I think that Stoya is making a good job at trying to argue from an economic perspective (with this I mean that she's not making it all about the money, but also the intended and unintended consequences of interventions). For example, she says that condoms can cause abrasions during the "abnormal" [her words] sex-making sessions in porn movies; thus, if a condom fails, this can even increase the risk of disease transmission.

That's interesting: I am not entirely convinced of the underlying (informal) model she is proposing, as I think she's possibly leaving other factors out of the equation, that should be taken into account. For example, I've no idea about this, but surely there must be statistics on other performer-to-performer infections; what if these show rates greater than 0? Sure, HIV is probably the worst outcome, but other diseases (for example HPV) may be also very relevant, both from the health and the financial perspective. 

And then there is the "educational" issue: given the large number of people watching porn, perhaps there is an explicit utility in showing performers wearing condoms. I absolutely have no idea or evidence that I could easily access here, but could this be even stretched as far as to say that it is cost-effective to invest public money in helping companies implementing this policy? 

Finally, some of the comments to the article, suggest that one of the obvious implications will be that some of the productions will probably move away from California (or LA, at least). This reminds me of a kind of similar issue with financial banks, here in London. The argument against increasing their fiscal contribution to the UK government is that in that case the corporations may choose to leave for countries with lighter taxations. Again, I think this is just one side of the story, as there is an implicit utility to being based in London (or in LA, if you're an actor/producer). While I understand that moving a business somewhere else could lead to losses to the central government (LA county in this case), I also think that this is not an entirely genuine threat. 

May be the implementation of the policy should have been subject to the results of a full cost-effectiveness analysis (I doubt it was $-$ but that's just a very uninformed opinion). I wonder if the NIH (or someone like them) would fund someone to do it?



Please comment on the article here: Gianluca Baio's blog

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