Money Honeys: The Freakonomics Guys On The Economics Of Prostitution

If you’re anything like me, the life of a high-class prostitute has intrigued you since Secret Diary Of A Call Girl. But note I said high-class prostitute: this career choice only piques my interest insofar as I could earn the big money. Lucky for me, the authors of Freakonomics figured this out. Steven Levitt and Stephen Dubner have written a new book, Superfreakonomics, in which they explain the paradox of how high-class prostitutes make a crap load of money by not working very long hours.First, Dubner and Levitt examined a study by sociologist Sudhir Venkatesh of prostitutes in inner-city South Side Chicago who earned roughly $27 an hour, performed 10 sex acts a week, and took home about $350 each week.

Next, they examined Allie, a high-class prostitute who charges $300 an hour, $500 for two hours, or $2,400 for a 12-hour sleepover.

Why the hell, they wondered, is there such a disparity?

The authors point out how in Ye Olden Tymes, lower-end prostitutes earned today’s equivalent of $78,000 per year. Comparatively, that’s a lot more than the Chicago ladies in Venkatesh’s study. But 100 years ago (the time period Levitt and Dubner based their calculations on), premarital sex, casual sex and “friends with benefits” didn’t exist. Generally speaking, if a man in 1909 wanted to have premarital sex, visiting a prostitute was an enticing option, so prostitutes could earn a pretty penny off of it. But since premarital sex isn’t taboo anymore, Dubner and Levitt argue that nowadays men who want sex can just sleep with one of their friends or f**k buddies or whatever.

Still, that doesn’t explain why a high-class prostitute like Allie can still charge $300 an hour for doing something prostitutes on the South Side of Chicago do for less than thirty bucks.

The South Side prostitutes lived in an impoverished neighborhood controlled by a gang and admitted to stealing from their clients or accepting drugs in lieu of cash; I’ll venture a guess that the clients who visit these Chicago prostitutes can get free sex elsewhere. Allie, on the other hand, specifically described her clientele as “middle-aged white men, 80% of whom were married, and they found it easier to slip off during work hours than explain an evening absence.” Levitt and Dubner’s analysis is that these married, middle-aged men actually have a lot in common with the randy young fellows of 1909. The only free sex these guys get is with their wives, so their “taboo” paid sex drives up the price a prostitute can get away with charging.

All this talk of the economics of prostitution isn’t perfect, of course, without considering factors we don’t know about, such as race or class, and sex workers who are obliged to turn over part of their earnings to a madam or pimp. (Allie was only in business for herself.) Furthermore, I could blog a thousand words arguing that the prostitutes earning only $27 an hour are being exploited. This economic analysis isn’t as cut-and-dry, easy-peasy as the Freakonomics guys make it look.

Nevertheless, prostitution seems to be a lot like real estate in a least one regard: when it comes to making bank, it’s all about location, location, location.