Monday, June 30, 2008

Gas and Prostitutes

As everyone's favorite Managerial Economics textbook tells us: when the price of a complement increases, demand decreases. What's not always obvious is what products might be complementary to your offering.

Nevada brothels have recently discovered that gasoline is a complement to their services, that is, gas and brothel services tend to be consumed together. No, no, the brothels don't have gas pumps out front. Their locations just tend to require a fair amount of travel.
Several of the hardest hit are the houses of prostitution in Nevada's rural northern areas, which get roughly 60 percent of their business from truckers. "Some of these brothels are out in the middle of nowhere so fuel prices have an effect, says Dennis Hof, owner of the infamous Moonlite Bunny Ranch.

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