Simply legalizing sex work is not enough. We have to combat the social stigma. We have to craft regulation that puts the power in the hands of sex workers, not brothels. We have to put in place enforcement strategies that combat and discourage human trafficking (such as undercover checks of immigration status that provide amnesty for illegal immigrants while prosecuting those who trafficked them.) The solutions to combat exploitation and coercion are not simple, but making it illegal solves very few problems beyond allowing some people to feel morally superior.
As we work towards solving these problems, our position on the supply/demand curve will shift to provide a price where supply equals demand.
No, I don't. I was countering the PC's notion that prostitution should be treated like any other profession.
From a economics stand-point, there's way higher demand than supply. And currently the only supply is another person. Most people won't willingly choose to be prostitutes when they have other options. Surprise! This big supply/demand gap leads to some very unsavory ways to increase supply:coercion and exploitation.
Maybe one day something like sexbots will change this dynamic, but until then the sex trade is a very difficult and tragic problem.