UK to count prostitution, drugs when measuring GDP

LONDON — Britain is putting a price on vice.

Prostitution and the import, manufacture and consumption of illegal drugs like crack cocaine and heroin will be included in the official estimates of the country’s economy, the national statistics agency said Friday.

Some of these activities, like prostitution, are legal in certain European Union countries, and comparable figures are needed. All member states need the same standard because they are used to assess a member state’s contribution to the EU budget.

The new estimates also simply seek to get a more realistic picture of the economy — warts and all. At the moment, the only illegal activities included in Britain’s GDP are estimates on alcohol and tobacco smuggling.

“As economies develop and evolve, so do the statistics we use to measure them,” said Joe Grice, the chief economic adviser to the Office of National Statistics. “These improvements are going on across the world and we are working with our partners in Europe and the wider world on the same agenda.”

Illegal drugs and prostitution are already measured in Estonia, Austria, Slovenia, Finland, Sweden and Norway, the ONS said in a report.

In Britain, they would add approximately 10 billion pounds ($16.7 billion) to gross domestic product in 2009, the ONS said. That remains a very small portion of the overall GDP, which now stands at 1.5 trillion pounds.

Nonetheless, calculations may prove challenging.

To measure prostitution, statisticians will have to tabulate up the value of things like brothel rental, condom sales, makeup and the clothing of sex workers.

For illegal drugs, the ONS will examine production and sales of crack cocaine, powder cocaine, heroin, cannabis, ecstasy and amphetamines. Growing drugs will be classed as “production,” buying them for home use, “expenditure,” while selling them as “income”.

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