Living Reference Work Entry

Encyclopedia of Law and Economics

pp 1-6

Date: Latest Version

Prostitution, Demand and Supply of

  • Øystein HernæsAffiliated withDepartment of Economics, European University InstituteNorwegian Social Research Email author 
  • , Niklas JakobssonAffiliated withOslo and Akershus University College of Applied Sciences, Norwegian Social Research and Karlstad University
  • , Andreas KotsadamAffiliated withDepartment of Economics, University of Oslo


The market for sex is a contentious one, and has often been subject to heavy regulation. This chapter goes through factors that are important with regards to the demand for and supply of prostitution. A particular focus is on the relationship between laws and the quantity of sex bought and sold. The most common way that laws have been used to affect the demand for prostitution is by outright criminalization, which may lead to less prostitution, but may also drive the activity further underground. The effect of criminalizing prostitution on trafficking is ambiguous since criminalization may also lead to a substitution effect towards more trafficked prostitutes. Scarcity of reliable data is one of the main challenges for the study of prostitution.