Research on human trafficking is still in its early stages, but is growing as the seriousness of the problem becomes more apparent. It is thought to be second only to drug trafficking as the most profitable illegal industry.
The scale effect prevails
In an article in the January 2013 edition of the journal World Development,Professor Eric Neumayer of the London School of Economics and Political Science (LSE), Dr Seo-Young Cho of the German Institute for Economic Research, and Professor Axel Dreher of Heidelberg University investigate empirically which economic effect prevails: the substitution e?ect away from tra?cking or the scale e?ect increasing tra?cking.
On the basis of an analysis of data from 150 countries, the authors conclude that countries with legalized prostitution have a statistically signi?cantly larger reported incidence of human tra?cking in?ows. This holds true regardless of the model that were used to estimate the equations and the variables we control for in the analysis.
Explosion of trafficking in Germany
The article’s authors looked in more detail at Sweden, Germany and Denmark, which changed their prostitution laws during the past 13 years. Sweden prohibited it in 1999, while Germany further legalised it by allowing third-party involvement in 2002. Denmark decriminalised it in 1999 so that self-employed prostitution is legal, but brothel operation is still forbidden.
Germany showed a sharp increase in reports of human trafficking upon fully legalising prostitution in 2002. The number of human trafficking victims in 2004 in Denmark, where it is decriminalised, was more than four times that of Sweden, where it is illegal, although the population size of Sweden is about 40 per cent larger.
"Germany is known to have one of the largest prostitution markets in Europe, with about 150,000 people working as prostitutes", the article states. "This means that the number of prostitutes in Germany is more than 60 times that of Sweden, while having a population (82 million inhabitants) less than 10 times larger. In terms of human tra?cking victims, the ILO estimated the stock of victims in Germany in 2004 to be approximately 32,800—about 62 times more than in Sweden."
Boosting criminal industry
Eric Neumayer, Professor of Environment and Development at LSE, commented; "Most victims of international human trafficking are women and girls coerced into the sex industry abroad. We wanted to find out if legalised prostitution increases or reduces demand for trafficked women. One theory is that legalised prostitution reduces demand because legally residing prostitutes are favoured over trafficked ones after legalisation."
"However, our research suggests that in countries where prostitution is legalised, there is such a significant expansion of the prostitution market that the end result is larger reported inflows of human trafficking. While legalising prostitution can have positive effects on the working conditions of those legally employed in the industry, it also appears to boost the market for this fast-growing global criminal industry."
2.5 million people trafficked yearly
One of the reasons legalisation does not lead to less coercion in prostitution is that a greater portion of coerced prostitutes'earnings can be extracted, making their pimps’ business more lucrative than operating with legal prostitutes.
Every year, thousands of men, women and children are trafficked across international borders. The vast majority of countries in the world are affected by trafficking, whether as a country of origin, transit or destination for victims. The United Nations estimated in 2008 that nearly 2.5 million people from 127 different countries had been being trafficked into 137 countries around the world.