Essays on the economics of prostitution and sex crimes

Defence date: 12 December 2018Examining Board: Prof. Juan Dolado, EUI, Supervisor; Prof. Andrea Ichino, EUI; Prof. Irma Clots-Figueras, Universidad Carlos II de Madrid; Prof. Bas van der Klaauw, VU University AmsterdamThis thesis consists of three chapters devoted to analyse the determinants of prostitution and sex crimes. The first chapter, jointly co-authored with Micaela Sviatschi (Princeton), finds evidence that adult entertainment establishments and sex crimes behave as substitutes. We build a daily panel that combines the exact location of not-self-reported sex crimes with the day of opening and exact location of adult entertainment establishments in New York City. We find that these businesses decrease daily sex crime by 13% per police precinct. The results imply that the reduction is mostly driven by potential sex offenders frequenting these establishments rather than committing crimes. The second chapter shows that improving prostitutes’ outside options deter prostitution. Specifically, this chapter fills the gap between two strands of the literature suggesting that unilateral divorce should decrease prostitution as a result of higher wives’ welfare. I build a unique panel data set for the U.S to test this prediction. Differences in the timing of entry into force of unilateral divorce laws across U.S. states provide a quasi-experimental setting allowing to estimate the effect of unilateral divorce laws on female prostitution (proxied by female prostitutes’ arrests). Using a diff-in-diff estimation approach, I find that unilateral divorce reduces prostitution by about 10%. I explore several mechanisms that could rationalize my findings. The mechanism that fits best the empirical evidence is one where unilateral divorce improves the option value of getting married by increasing wives’ welfare. As a result, the supply of prostitution declines. Finally, in the third chapter I rely on a recent economic literature, including Chapter 1 of this thesis, reporting evidence on how sex crime and prostitution behave as substitutable activities. This chapter makes use of variation in fines for sex purchase in Sweden to analyse the relationship between criminalising the purchase of prostitution and rape; and finds that higher fines for sex purchase increase rape on impact.-- 1 The Effect of Adult Entertainment Establishments on Sex Crime: Evidence from New York City, 1 (Chapter 1: co-authored Micaela Sviatschi) -- 2 The Effect of Unilateral Divorce on Prostitution: Evidence from Divorce Laws in U.S. States, 25 -- 3 The link between prostitution laws and rape crimes: Evidence on alternative mechanisms, 71 -- A Appendix: The Effect of Adult Entertainment Establishments on SexCrime: Evidence from New York City, 101 -- B Appendix: The Effect of Unilateral Divorce on Prostitution: Evidence from Divorce Laws in U.S. States, 137 -- Bibliography, 15