Prohibitions: Sex, Markets, and Commodification

Each prohibition has its cruxes. In previous blogposts, we saw that cruxes of polygamy are social imbalance and pre-modernity, whereas the crux of mind drugs is addiction.

The cruxes of sex markets are commodification , stigma , and a complex of coercion, inequality, and discrimination. In this blogpost I focus on commodification, or transformation of goods and services into markets. I’ll cast the net wide, then draw it back to prohibitions.

Commodification

What is the quarrel with commodification? Bryan Caplan proposes to make sense of politics by a “Simplistic Theory of Right and Left:”

“Leftists are anti-market. [… .] Rightists are anti-leftist.”

At the extreme left, Karl Marx propounds a general critique of commodification. Markets cause objective, manifold alienation. Specifically, markets alienate humankind from its ‘species being,’ workers from the products of their labor, workers from the labor process, and workers from fellow workers. Contemporary history involves processes whereby objective alienation begets a subjective sense of alienation. Shared awareness of alienation then motivates workers to become ‘a class for itself’ and to establish communism.

Marx’s blanket critique of markets misses the selectivity of political psychology about the proper scope of markets. Prohibitions motivated by concerns about commodification target a specific subset of markets; for example, sex markets, markets for organs for transplantation, and markets for adoption. Nonetheless, one of Marx’s categories—a sense of alienation from humankind’s ‘species being’—captures, in abstruse philosophy, something of the repugnance or moral outrage, which largely motivate prohibition of these specific markets. Caplan’s Simplistic Theory of Left and Right is orthogonal to political psychology about these markets. Rejection of these markets cuts across Left and Right. Everyone accepts or encourages the underlying non- market behaviors —consensual sex, supply of a kidney for transplantation, adoption—but a cross-cutting majority opposes commodification of these behaviors.

There are differences in kind among these controversial markets. Sex markets supply a service. Kidney markets permanently transfer a body part. Adoption markets commodify parental rights while the child is a minor. A fundamental distinction may be drawn between (a) consensual commodification (sex markets, kidney markets) and (b) commodification of parental rights in children. Adoption intrinsically exceeds adult consensual behavior, whether or not there is a market. Children are not of the age of consent.

Is there a tailored, parsimonious case against commodification of such disparate behaviors? (Remember, Marx’s normative theory overshoots.) It might be thought that there is a conceptual or metaphysical case. Some goods and behaviors, by their nature, aren’t commodities. The Medal of Honor is an example of an ironclad non-market good. There would be no honor in buying the Medal. Although the physical Medal (rarely) has been purchased in post-allocation trade, it is nigh impossible to purchase official award of the Medal and ceremonial presentation by the President. However, sex, kidneys for transplantation, and adoption don’t fit this mold. There exist markets—legal and illegal—in sex and in kidneys. Commercial sex is sex nonetheless. A market for kidneys and kidney donation alike supply kidneys for transplantation. Similarly, commercial adoption, too, would transfer parental rights.

Can’t Buy Me Love

The Medal of Honor is a limit case. Shades of grey abound in other goods. Consider love , a classic example of what can’t be bought or sold. A philosopher might say, the idea of a market for love is a category mistake, because love, conceptually, can’t be an object of exchange. Artists, however, paint complex psychologies of love. Paul McCartney and the Beatles famously struck a chord with the song, “Can't Buy Me Love.” McCartney’s lyrics express a romantic love, which entwines intense desire for reciprocity of sentiment, deep generosity conditional on reciprocity of sentiment, and anxiety about material motives:

“I'll give you all I’ve got to give,
if you say you love me, too.
I may not have a lot to give,
but what I’ve got I’ll give to you.

[… .]

Say you don’t need no diamond rings,
and I’ll be satisfied.
Tell me that you want the kind of things
that money just can’t buy.”

In public statements, McCartney explained that exchange is the thorn:

“When pressed by American journalists in 1966 to reveal the song’s ‘true’ meaning, McCartney stated that, ‘I think you can put any interpretation you want on anything, but when someone suggests that “Can’t Buy Me Love” is about a prostitute, I draw the line.’ He went on to say: ‘The idea behind it was that all these material possessions are all very well, but they won’t buy me what I really want.’”

McCartney’s views evolved with experience:

“However, [McCartney] was to comment later: ‘It should have been “ Can Buy Me Love”’ when reflecting on the perks that money and fame had brought him.”

“If you may do it for free, you may do it for money.”

Jason Brennan and Peter Jaworski make a case against the case against commodification. I say ‘a case against the case against’ because the double negative doesn’t make a positive. Brennan and Jaworski don’t make a case for commodification. Their slogan is: If you may do it for free, you may do it for money. Jaworski articulates the thesis more precisely:

“If it is permissible, but not obligatory, to do for free, then it is permissible, but not obligatory, to do for money.” (Cue time: 00:57:15)

By ‘permissible,’ Brennan & Jaworski mean morally permissible. Jaworski illustrates the thesis by recounting a discussion at a lecture he delivered at Brigham Young University:

“Here’s the real question: Is it permissible for someone to have sex with a stranger for free? […] The people in the room were like, ‘Wait a second. No, no, no. You need to jump through these hoops in order to have sex with somebody.’ [… .] So it follows that on their view it wouldn’t be permissible to have a market of any description in that kind of service.” (Cue time: 00:13:38)

Might entrepreneurial sex workers then create a niche market, with precisely those hoops, for clients who must jump through them in order to have sex with the sex worker? In any case, strangers often can and do form ongoing commercial relationships in sex markets, and thereby become something other than strangers.

Jaworski insists that a market makes no moral difference whatsoever:

“the market is neutral. There is no introduction of immorality or improvement. It’s not like the market makes things better—the particular exchanges. And the market doesn’t make things worse. [… .] You might think that a market introduces incentives that weren’t there already. But in the abstract you can imagine: Suppose that somebody exchanged a particular item with the same incentives, except remove the market here. If that’s okay, then it’s okay to have it on the market.” (Cue time: 00:14:43)

From Adam Smith to William Baumol

But a market does introduce incentives that weren’t already there! Markets foster specialization. Adam Smith explains:

“the certainty of being able to exchange […] encourages every man to apply himself to a particular occupation, and to cultivate and bring to perfection whatever talent or genius he may possess for that particular species of business.”— The Wealth of Nations , I.2

Is prostitution an exception to the rule that specialization improves performance? Or might a large fraction of sex clients prefer part-time, free- lance sex workers (i.e., low specialization)? However that may be, sex markets presumably exhibit the Baumol effect. Eric Helland and Alex Tabarrok provide a clear summary of the mechanism (but not specifically in the context of sex markets):

“The Baumol effect is easy to explain but difficult to grasp. In 1826, when Beethoven’s String Quartet No. 14 was first played, it took four people 40 minutes to produce a performance. In 2010, it still took four people 40 minutes to produce a performance. [… .] in 2010 it was 23 times […] more expensive to produce a performance of Beethoven’s String Quartet No. 14 than in 1826. In other words, one had to give up more other goods and services to produce a music performance in 2010 than one did in 1826. Why? Simply because in 2010, society was better at producing other goods and services than in 1826.” (pp. 36-37)

Similarly, even if specialization in prostitution improves performance, productivity probably increases less than in many other markets. On the other hand, productivity in pornography increases rapidly thanks to synergy of innovation (the internet), ever more specialization of genres, and growth in the extent of the market. Therefore, pornography may serve partly as a substitute for physical sex markets, especially where the latter are prohibited.

Perhaps the most important incentive, which a sex market introduces, is the incentive to enter the sex work upon coming of age. A novice might therefore get ensnared in myopic rationality. The prospective sex worker readily observes that compensation in the sex industry has a peculiar time profile. Unlike the professions, which require long, costly investment in human-capital formation and in formal credentials, sex work immediately rewards natural endowments, youth, and even inexperience. Would temptation undermine long-term investment in human capital or signaling? Would a novice accurately gauge the risk of psychological trauma from sex work?

Given that markets often introduce incentives, externalities, and internalities, we may question Jaworski’s assertion that a market makes no moral difference. Incentives, externalities, and internalities can be positive or negative. For example, if sex work increases propensity to self-medicate and to experience addiction (a negative internality), or if part-time sex work enables many single mothers to devote more time and energy to care for their children (a positive externality), then there are fresh moral considerations.

Legality?

The larger question is whether Brennan’s and Jaworski’s thesis, about moral neutrality of markets, provides guidance about the policy choice between legality and prohibition. After all, morality isn’t a necessary condition for legality of behaviors and markets in an open society. Jaworski leans toward legality of sex markets, even legality without regulation:

“Should prostitution be allowed? The answer, I think, is yes , and libertarians are going to say yes. […] I’m not suggesting that it should be illegal. I’m not saying: ‘The government should come in and regulate it, and make it be in accordance with my own conception of the right way to buy and sell sex.’” (Cue time: 01:06:00)

Instead of regulation, Jaworski advocates public debate to shape business ethics:

“I think it would be wise for libertarians to focus a bit more on business ethics. […] And it is true that there are better and worse ways, from a moral point of view, to offer sex for sale, right? […] But […] leaving it up to the market to decide how people buy and sell all of these sensitive things? I think we should be vocal : ‘This is the wrong way of selling this thing. It should be sold in this way, rather than this other way.’” (Cue time: 01:06:00)

Although some will deem civic debate no match for markets, I find Jaworski’s policy principles refreshing. If proponents of prohibition would override a presumption of liberty, they must make a clear and convincing case, and must tailor any prohibition as narrowly as possible. Broad arguments against commodification lack bite. Even love survives the tinge of implicit markets. Although markets aren’t exactly morally neutral, the idea is more sensible than overblown critiques of commodification. Beyond commodification, the Baumol effect might shape sex markets, despite competition from pornography. Even cursory attention to incentives, externalities, and internalities in sex markets identifies both costs and benefits. There is potential self-harm (a valid, weighty argument for paternalism), about seemingly intrinsic, seductive incentives to enter sex work upon coming of age. There are potential large benefits of legal sex work for other demographics of disadvantaged women; particularly single mothers. Of course, legality reduces harms from prohibition (corruption, rates of violence), unless black markets remain extensive. My next blogposts will address other cruxes of sex markets: coercion, inequality, discrimination, and stigma.

Links to previous blogposts in this series about prohibitions: Constitutional democracy; Common rationales for prohibitions; Polygamy; Mind drugs and addiction; and Mind drugs and policy.

The post Prohibitions: Sex, Markets, and Commodification appeared first on Econlib.

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