A new indicator in the Turkish economy: 'Pavilion Index'

Economy journalist Bora Erdin evaluated the Turkish economy through an interesting parameter. "Let's add a new index to our lives," said Erdin, as he assessed the indicator he dubbed the 'Pavilion Index,' also known as the 'Stripper Index' or 'Champagne Index'. 

"Of course, this is not the actual name of this index. The closest example in Turkey for this indicator, which is called the Stripper Index or Champagne Index, is the 'pavilion' (nightclub)," Erdin said, adding, "We will also take a look at the subject of pavilions, which has come to the agenda again with Yılmaz Erdoğan's series 'Inci Taneleri' (Pearls of the String). Let's see how the index, which we will refer to as the Pavilion Index from now on, entered our lives." 

Erdin explained the 'Pavilion Index' as follows: 

"In the constantly evolving world of economics, economists use various macroeconomic measures known as economic indicators. These indicators provide vital insights into a country's economic health, enabling policymakers, businesses, and individuals to forecast economic cycles and implement necessary policies, investments, and daily financial decisions. Traditional economic indicators such as Gross Domestic Product (GDP), inflation, and Gross National Product (GNP) are among the most widely used and important metrics.

However, new, unconventional financial indicators that seem to have no connection to the economy have emerged as invaluable tools for predicting and understanding the complexities of the economic world. Ranging from lipstick sales to the popularity of men's underwear, these new metrics capture nuances that traditional measurements might overlook.

Examining the income disparity in the sex industry in the years leading up to the 2008 Great Recession shows how we can use this new tool to understand economic trends and predict emerging cycles.

The roots of the crisis were in the US housing market, where a housing bubble inflated as home prices rose rapidly in the years before 2007. Easy access to mortgage loans, including subprime mortgages, allowed many people to buy homes and invest heavily in real estate. When the housing bubble began to burst in 2007 and peaked with the 2008 recession, home values fell, leading to a significant reduction in homeowners' wealth. This decline in real estate values and housing-related investments directly affected consumer spending, as people had less equity in their homes to borrow against or sell to cover their discretionary income. The financial turmoil that emerged in 2007 and 2008 contributed to direct job losses across various sectors and further reduced the public's funds for non-essential purchases, including the products and services of the sex industry. 

However, sex workers could have warned economists years before the recession truly began. In a study funded by the US government on the economics of the commercial sex industry, researchers found that the size of the underground commercial sex economy in all but two of the seven cities studied shrank from 2003 to 2007, just before the recession fully consumed America. This decline in the consumption of sex industry products and services brings us back to examining consumer spending; the declining income of sex workers served as an indicator of the decline in public capital that emerged with the collapse of the housing market during those years and ultimately led to the 2008 recession.

"When customers don't have the money to throw a few singles in the air or pay for a $20 lap dance, we might be in deep trouble." Sex work predicted the 2008 Great Recession and the economic downturn cycle in 2022, and economists began to grasp the relationship between the sex industry, the microeconomics of observing consumer spending, and national economic cycles. The Stripper Index not only offers a new perspective on predicting economic trends but also emphasizes the importance of expanding our understanding of the factors that influence financial markets; destigmatizing sex work and recognizing its role as a significant economic contributor is the next step. The Stripper Index reminds us that various factors and industries can provide important clues about the state of our economy and that no source of information should be ignored in this ever-changing environment." 

News Source: 12punto