Prostitution in a city - night prostitute talking to potential customer
Getty Images/Vetta
By Del Quentin Wilber

They pit employees against each other to maximize performance, set financial quotas and are adapting to a rapidly changing technological landscape.

That sounds like a description of corporate executives, but it also applies to the illegal sex trade, according to a study published Wednesday by the Urban Institute in Washington. "Many pimps had a business savvy, and they knew what they needed to do to maximize profits," said Meredith Dank, the study's lead author and a former commodities analyst. "They saw themselves as managers, as business owners, as entrepreneurs."

The conclusions are based on interviews in eight U.S. cities. The sex trade in seven (Washington, Atlanta, Dallas, Seattle, San Diego, Miami and Denver) totaled $975 million in 2007, or $1 billion in today's dollars, according to the study. The eighth (Kansas City, Mo.) wasn't included in the economic analysis. Funded by a $499,000 Justice Department grant, the study relied on more than 260 interviews of police, pimps and prostitutes, the institute said.

Dank, who worked as an analyst for Tokyo-based trading firm Mitsui & Co. and in public relations for Sony before earning a doctorate in criminal justice in 2009, interviewed 73 pimps, all jailed on federal and state charges, and three dozen prostitutes in 2012 and 2013 for the 340-page report, "Estimating the Size and Structure of the Underground Commercial Sex Economy in Eight Major U.S. Cities." She said that understanding the business side of the illegal sex trade should help authorities better prevent and combat it.

Traveling to Playoffs and Natural Disasters

The sex business has become more reliant on the Internet and mobile technology to recruit prostitutes and customers. More than half of the pimps surveyed said they used some form of online advertising, the study found.

More than 70 percent of the pimps said they traveled to cities hosting major events, such as the National Basketball Association playoffs, for the large crowds of men. They even visited the sites of natural disasters because those areas were often flooded with workers who had cash to spend, Dank said.

Pimps employed an average of five prostitutes, and street gangs were increasingly involved, the study found. The pimps treated women as a commodity "like gold, platinum," one said. Some pimps established quotas for their workers and others fueled competition between their prostitutes. "I had a quota of $600. If they came back with $550 or even $599, she had to just go back out," one pimp reported.

Although the economic downturn pushed down prices, most of those surveyed "shared the sentiment that a high market demand for sex always exists," the study said. Competing pimps weren't as cutthroat with each other as researchers had expected. "Many pimps viewed it as a brotherhood, a code they abided by, where they would help each other out," Dank said.

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