Is prostitution really worth £5.7 billion a year? [Data Skepticism]

Is prostitution really worth £5.7 billion a year? by David Spiegelhalter.

From the post:

The EU has demanded rapid payment of £1.7 billion from the UK because our economy has done better than predicted, and some of this is due to the prostitution market now being considered as part of our National Accounts and contributing an extra £5.3 billion to GDP at 2009 prices, which is 0.35% of GDP, half that of agriculture. But is this a reasonable estimate?

This £5.3 billion figure was assessed by the Office of National Statistics in May 2014 based on the following assumptions, derived from this analysis. To quote the ONS:

  • Number of prostitutes in UK: 61,000
  • Average cost per visit: £67
  • Clients per prostitute per week: 25
  • Number of weeks worked per year: 52

Multiply these up and you get £5.3 billion at 2009 prices, around £5.7 billion now.

An excellent example of data skepticism. Taking commonly available data, David demonstrates the “£5.7 billion a year” claim depends on 400,000 Englishmen visiting prostitutes every three (3) days. Existing data on use of prostitutes suggests that figure is far too high.

There are other problems with the data. See David’s post for the details.

BTW, there was some quibbling about the price for prostitutes, as in being too low. Perhaps the authors of the original estimate were accustomed to government subsidized prostitutes. 😉

Should prostitution pricing come up in your data analysis, one source (not necessarily a reliable one) is Havocscope Prostitution Prices. The price for a UK street prostitute is listed in U.S. dollars at $20.00. Even lower than the original estimate. Would dramatically increase the number of required visits, by about a factor of five (5).

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