More Month at the End of the Money: The Effects of Welfare Benefits on U.S. Prostitution Markets

My senior Economic Thesis investigates the question: do financially vulnerable women rely on transactional sex for consumption smoothing? Or, in other words, what is the effect of state level maximum welfare benefits on... [ view full abstract ]

My senior Economic Thesis investigates the question: do financially vulnerable women rely on transactional sex for consumption smoothing? Or, in other words, what is the effect of state level maximum welfare benefits on patterns in U.S. sex markets? Using quasi-experimental methods, I exploit the spatial and temporal variation of maximum welfare benefits over the years 1998-2014 on a state level basis in order to use changes in maximum welfare benefits as a proxy for an economic income shock. I will utilize data from previous work on prostitution and online clearinghouses to represent transactional sex market activity. The purpose of this work is to understand unintended potential consequences of welfare policy changes for low-income single mothers in the United States. Working results for this research indicate that decreasing welfare benefits increase activity in U.S. prostitution markets.