Prostitution, GDP, and £1.7 billion due

Posted to Statistics  |  Tags: , ,  |  Nathan Yau

David Spiegelhalter, professor of public understanding of risk, does some back-of-the-napkin math to describe why recent prostitution estimates for the UK are problematic.

As always, it’s best to do a simple reality check. The ONS assumptions come to around 61,000,000 visits a year. Let’s say 50,000,000 are from locals rather than foreign visitors. There are around 27,000,000 men between 18 and 50 in the UK (taking an arbitrary upper limit), so this would mean that on average each of them buys sex twice a year. In fact the latest Natsal survey found that 3.6% of men reported paying for sex in the last 5 years – let’s say that means that considerably less than 1,000,000 men a year pay for sex, maybe 500,000. So the ONS assumptions mean that men who pay for sex do so on average twice a week. This seems high.

The assumptions also mean that the average person working in prostitution is turning over nearly £100,000 a year, which Jolyon from Tax Relief 4 Escorts says is completely implausible, and he should know.

Spiegelhalter makes a few of his own assumptions in there, but you can see why estimating illegal activity and then using those numbers to calculate gross domestic product can be a challenge.

If you recall, the gross domestic product for the United Kingdom rose by 5 percent, largely in part due to estimates trying to account for drug sales and prostitution. Given that illegal activity and careful, public record-keeping typically don’t go together, the new numbers were rough at best. For prostitution in particular, the numbers from the Office of National Statistics estimated an extra £5.7 billion added to the GDP.

The problem now is that the United Kingdom, as a member of the European Union, apparently owes £1.7 billion. This is based on gross national income which uses gross domestic product in its equation. Ouch. Consequences.

Favorites

Years You Have Left to Live, Probably

The individual data points of life are much less predictable than the average. Here’s a simulation that shows you how much time is left on the clock.

The Best Data Visualization Projects of 2011

I almost didn’t make a best-of list this year, but as I clicked through the year’s post, it was hard …

Jobs Charted by State and Salary

Jobs and pay can vary a lot depending on where you live, based on 2013 data from the Bureau of Labor Statistics. Here’s an interactive to look.

Think Like a Statistician – Without the Math

I call myself a statistician, because, well, I’m a statistics graduate student. However, the most important things I’ve learned are less formal, but have proven extremely useful when working/playing with data.