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The only way to control something effectively is to get it above ground, visible and accessible to the authorities. Yes there will be some who still go underground for sex with under age people or abusive practices but they will happen anyway.
If it's legal and licenses authorities can dictate where, how and when it's carried out. Control the people working in it, tax is paid, make sure they're honest, people are not forced to work as prostitutes, safe sex rules are adhered to, establishments are as discreet as the community requires and a ton of other things.
All the above is paid for via the taxes raised from the licenses and tax paid on sales and profits.
The problem in some countries is getting it past the law makers. Here in Czech prostitution within certain limits is legal and controlled to a far greater extent than in countries like the US.
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