I just read Alexandre Padilla's very interesting paper "Self-Regulation in the Adult Film Industry: Why Are HIV Outbreaks the Exception and Not the Norm?" Here's the revised abstract:

This paper analyzes how self-interest and long-term profit expectations provided the necessary incentives for the adult film industry to self-regulate and to find mechanisms to minimize the risks of HIV outbreaks that could result from the asymmetric information and network effects that characterize the industry. With the help of the Adult Industry Medical Healthcare Foundation (AIM), the adult film industry developed a corporate culture to facilitate widespread coordination among members and to make the industry similar to a private club. First, I discuss the predicted effects of asymmetric information and network-effect problems on the industry in terms of HIV outbreaks. Second, I tell the story of AIM and present the policies the industry has adopted since AIM’s creation to mitigate those predicted effects. In particular, I discuss how the industry managed the 2004 HIV outbreak without government intervention. Finally, I present statistics comparing HIV infection rates in the industry and general population as well as additional observations to assess the relative effectiveness of the industry in preventing and containing HIV outbreaks.

A couple of comments are in order. I really like the research design. Alex is exploring how self-regulatory institutions arise to address problems arising from networks and asymmetric information; in the porn industry, these problems are crystal clear and at the center of how the industry operates. Thus, the probability of arriving at clear insights that aren't gummed up by confounding factors is pretty high.

The worst-case scenario--HIV infection--is very clear and the transmission mechanism is unambiguous. That said, I would be interested in seeing just how the risks of working in porn compare to the risks of other hazardous occupations--in other words, I wonder how the estimated HIV-related cost of working in porn compares to the estimated injury-related cost of working in construction. Further, how does the insurance market work for porn? Do porn stars pay higher or lower premiums? How does this affect their incentives?

Another thing I like about the research design--which also complicates it a little bit--is that pornography is an internationally competitive market with near-perfect capital mobility. It can be produced virtually anywhere and sent anywhere at the click of a button. This puts serious constraints on regulators and has implications for how the industry self-regulates. I'd like to see this explored in greater detail.

The paper will probably attract attention because it has the phrase "Adult Film Industry" in the title, but the most important term in the title (and in the paper) is "Self-Regulation." It's a very interesting paper because of the obvious and seemingly intractable problems in a globally competitive industry. I look forward to seeing where this leads.

Update: via email, Alex tells me that it's going to lead to a book. I look forward to it.