Proposal 1: Human Trafficking- Modern Day Slavery?



For my white paper, I want to explore the topic of human trafficking. Human trafficking is a global issue and is essentially modern-day slavery. Many people want to turn their heads and believe that slavery no longer exists when the reality is just the opposite. One of the reasons that human trafficking does exist is because it is such a lucrative business. This really isn’t a big secret as this has been public knowledge for such a long time, and in recent years, this has been “played up” in the entertainment industry as well (remember the movie Taken?) So, for the first proposal, I wanted to investigate the business side of human trafficking and learn what drives the economics of modern-day slavery.

I found an article called “Economics of Human Trafficking” published by the International Organization of Migration (IOM).  In the article, an economic model of human trafficking along with all known factors that affect human trafficking are described from both an international and national standpoint. The market for human trafficking is seen as a monopolistic competition that consists of many buyers and sellers dealing with differentiated products- those products being humans.

“We envision human trafficking as a monopolistically competitive industry in which traffickers act as intermediaries between vulnerable individuals and employers by supplying differentiated products to employers.”

In this market, the ease of entry and exit suggests a monopoly as the traffickers can enter the market easily if they see made by other traffickers and they can exit easily if they are not making a profit. This is due to three main reasons: 1.) there are many sellers in the market, 2.) there are many buyers that demand human trafficking victims for employment for a variety of reasons, and 3.) the market is characterized by product differentiation. Therefore, the authors conclude that the best economic model that describes this business is monopolistic competition.

The authors envision human trafficking surpassing drug and arms trafficking in the next 10 years in terms of growth of its incidence, cost to human well-being, and profitability to criminals both nationally and internationally. Additionally, revenues from human trafficking are high. The annual estimated average revenue per trafficked victim is US$ 13,000, totaling US$ 32 billion annually. In the United States, trafficked individuals are said to be as much as US$ 100,000 each. The costs that human traffickers face in their business, such as monetary (operational), physical (risk to life and health), psychological, and criminal (risk of being caught and punished), are viewed as low risk in the industry (so more than often they don’t spend money on these things), which therefore results in higher overall profits for the traffickers and their business.

This article helps support my idea that human trafficking is such a lucrative business. The facts and figures presented have provided me with a base for the business side of human trafficking, and it will help me further develop the concept of the entire business model of human trafficking. It is a reliable source of information, and I plan to use this source and elaborate further on more specifics of the article in my white paper. In my future research on the business side of human trafficking, I hope to be able to find information from various sources about estimates for profits of different geographical areas and pricing differentiation amongst victims.


One response to “Proposal 1: Human Trafficking- Modern Day Slavery?

  1. This is an interesting yet very disturbing topic. The business side of human trafficking almost sounds like we can accept human trafficking because we make money off it. I personally would not feel comfortable exploring this topic in this way, but you can for sure write a good paper on it. I wonder if you can actually find estimates for profits of different geographic areas. It seems like such a hush hush topic.

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