In the light of the recent HIV case in the adult film industry, I wrote with the assistance of Chris Mitchell, Director of Communications, and Adrian Moore, Vice President of Research, at Reason Foundation, an op-ed based on my academic unpublished paper on self-regulation in the adult film industry.
The op-ed basically repeats what I wrote in the paper. The adult film industry, given the market constraints, i.e., consumers rather watch movies without condoms than with condoms, is doing a pretty good job in preventing HIV outbreaks. If consumers do not want to see condoms in the picture, what’s the best next alternative: systematic testing. Since 1998, the adult film industry requires its performers and wannabe performers to be tested monthly with PCR-DNA HIV test instead of the standard ELISA test. Since 1998, there has been only one major outbreak where one performer infected three female performers. All the other cases of active performers testing positive for HIV have been detected prior to the performers being able to infect other performers.
Health officials and other commentators think that this new recent case is another evidence of self-regulation failure on the part of the industry. To my knowledge, this performer has not infected anybody else and, instead of viewing this as a failure, one should see this a success. Adult Industry Medical Healthcare Foundation discovers the performer testing positive prior to her infecting other performers.
Ultimately, the problem is not that the adult film industry does not want to use condoms. If using condoms were profitable, meaning, if consumers were indifferent between watching movies where condoms are being used as opposed to condoms not being used, this would not be a problem. Unfortunately, this is not the case.
Health officials want to mandate condoms. This is a very bad idea. Condoms should indeed be used and performers should be encouraged to use condoms, which, after all, do reduce risks of transmissions. But, if condom use were to be mandated through a regulation, the unintended consequences and associated costs would likely outweigh the benefits. I would go as far as to contain that imposing condoms would likely lead to more HIV outbreaks in the industry.Industry would go underground or just relocate outside California or outside the country, outside the reach of the government hand.
Government should learn from the prohibition era and the war on drugs. During the prohibition era, morality and health arguments were advanced to justify the prohibition of alcohol. What happened? Unintended consequences forced the government to repeal the prohibition. One thing the government should learn is that market forces can be hampered, slowed down but they can NEVER be stopped.
Good intentions just don’t guarantee good results. Bastiat wrote an essay called What is seen and What is Not seen. As an economist, you can’t simply focus on what is seen, you must also go further and examine the possible unintended consequences of a policy before you can pronounce any conclusions. This is a long tradition among economists to analyze the unintended consequences of economic well-intended policies. Coase, in a similar tradition, explained that as long as we do not understand that we are making choices between institutional arrangements that are more or less perfect, we are not going to make much progress.
The L.A. medias have overall rejected my op-ed. Maybe I was unable to convey clearly the message but I doubt this was the real reason.
that markets do not always satisfy consumers’ needs because of lack of profitability, it does not mean that non-for-profit markets or organizations won’t emerge to serve the consumers that for-profit organizations won’t serve. 
(2002), 
(2009), and 
(2010) published at the University of Chicago Press.