What Homophobia Costs a Country's Economy

The effect of homophobia on the global economy was dissected by a World Bank panel today, but the continued invisibility of an LGBT population, particularly in the developing world, means research remains a challenge.  

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The economic cost of homophobia, particularly for countries in the global south, is becoming increasingly clear, according to a panel that spoke at the World Bank on Wednesday. While the continuing invisibility of gays and lesbians means that it's difficult to get the numbers for a wide-reaching study,  the economic cost of homophobia ranges from about 0.1 of a percent to 1.7 percent of GDP, according to Dr. M. V. Lee Badgett, an economics professor at the University of Massachusetts, Amherst. In India, where Badgett conducted a case study, the numbers can be narrowed down to 0.1 to 0.7 percent of GDP.  For the world's LGBT population, homophobia can lead to loss of employment, workplace or educational discrimination, poor health, and poverty.

Speaking before a panel of experts and professors in the gender and development fields at the World Bank, Fabrice Houdart, president of World Bank GLOBE, an LGBT resource group for employees at the organization, called discrimination a “significant, self-inflicted economic wound.”

There are 77 countries that criminalize homophobia, according to the United Nations; seven of those implement the death penalty. Russia has recently been in the spotlight for its anti-gay laws, and Uganda’s anti-gay bill has been widely covered, as has the fact that American evangelical activism was an influence in the decision to harshly punish gay Ugandans. A proposed anti-gay law in Arizona was struck down by Gov. Jan Brewer in February, but a previous discriminatory bill that targeted undocumented immigrants cost the state $140 million in revenue.

Ethiopia is another nation where homosexuality is a crime, often with devastating consequences. Today in The Boston Globe, Maria Sacchetti wrote about a 19-year-old Ethiopian man who is facing deportation in Boston after losing his student visa, but who maintains that his life would be put in jeopardy if sent back home. The State Department said that gays in Ethiopia face jail time, abuse and interrogation.

While discrimination takes its toll on the individual, in the form of personal attacks or loss of wages, Badgett says that the combined effects of homophobia will manifest into the broader economic climate. “Individual effects [of homophobia] will translate into important economic outputs,” Badgett said, causing lower rates of education, poor health, and poverty, which in turn leads to a lower labor force and high health care costs.

Badgett’s case study of India also highlighted the enormous cost of health care due to homophobia in that country. HIV disparity, depression, and suicide, three health issues that are particularly high among the LGBT population, cost India between $712 million and $23.1 billion in 2012, according to Badgett’s study. “You reduce GDP by this much, you call that a recession, actually,” Bagdett said.  

“It’s only the beginning, it’s a small study and we’re hoping it opens up the door to much more work,” Houdart said.

The panel also spoke about enormous amount of data now available to bridge the severe gap for LGBT knowledge that prevents significant research from being done. Dr. Qing Wu, a senior economic analyst at Google, mined various, and somewhat unorthodox, sources for data, including Google queries for gay porn and Craigslist ads alongside the traditional Gallup poll.

A screenshot from a presentation by Google's Dr. Qing Wu on Google queries 
on homosexuality in the United States.

A Gallup poll found around 3.5 percent of American identify as gay, but an independent study by Wu, in which he asked other questions, like whether or not they were openly gay at work or school, found that 5.7 percent identified as LGBT. Wu also calculated the percentage of gay porn queries out of all porn queries, which arguably gives a greater insight into the lives of others than a phone survey ever could. Qing joked that “you can lie about yourself, but god knows what you’ve been doing on the internet.”

“We know, but we don’t know who you are,” Wu said. He also found that the gay population is fairly uniform across all states, and that the porn data shows “that a lot of people are in the closet.” Central America had the highest rates of gay porn queries, with 8 percent of the total porn searches in the region.

Another look into Google queries in the United States shows areas — primarily the South — where sin is still correlated with homosexuality, and where it seems closeted gay men are more likely to be married to straight women. More people are googling "is my husband gay" in Montana than any other state.

Jim Yong Kim, president of the World Bank Group, recently argued in The Washington Post, “Institutionalized discrimination is bad for people and for societies. Widespread discrimination is also bad for economies. There is clear evidence that when societies enact laws that prevent productive people from fully participating in the workforce, economies suffer.”

This article is from the archive of our partner The Wire.