Wednesday, January 14, 2009

Positive externalities of porn industry - case for bailout!!

Chris Dillow makes a case in support of Larry Flynt's (he has approached the US Congress with a $5bn bailout request, to "rejuvenate the sexual appetite of America") request for Government bailout of the porn industry.

Dillow calls porn, a "strategic industry", the "driving force" behind many technologies like the "triumph of VHS over Betamax tapes, cable TV, and broadband (an illuminating article about this is available here). In fact, it has been claimed that internet porn has been one of the biggest contributors towards generating the "network effects" (by getting more and more people hooked into computers) that have made computers (and even books in England and Italy, as indicated here) so successful as a technology. It also creates skilled workers for other industries; countless actors and cameramen have moved from porn to mainstream TV and film work."

It has also been claimed that sex has been a major source of comfort during the recession. Battered bankers and finance sector professionals have been seeking solace from the turmoil, by relying on the sex industry (apparently more for comfort that for any actual sex). If this is true, then there is a case for supporting the sex industry, so as to atleast keep the beleaguered society in good mental health!

In other words, it appears that, contrary to conventional wisdom (or am I wrong?), pornography has classic positive externalities, which if not supported by government, is likely to be undersupplied by the market!! Dillow should have the last word, "When we think of the great iconic images of America, what comes to mind? Surely, tits and arse more than cars. After all, no car has ever been elected to high office, but plenty of arses have. So, surely, isn’t the case for bailing out the porn business at least as strong as that for bailing out the motor industry?"

1 comment:

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