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Benefit-Cost Analysis for Crime Policy - NIJ Research for the Real World Seminar

NCJ Number
Date Published
February 2011
21 pages
This is the transcript and video of a presentation by Roseanna Ander and Jens Ludwig on "Better Cost Analysis for Crime Policy" as part of the National Institute of Justice Research for the Real World Seminar series.
They discuss the importance of benefit-cost analyses in making sound decisions regarding the allocation of scarce financial resources for crime-control, as well as various approaches for identifying policy and program impacts and challenges in placing dollar values on crime costs and benefits. Ms. Ander notes that important uses of benefit-cost analysis are in determining how much crime control is needed and how to get the maximum crime control for a given cost. An example is provided of the utility of benefit-cost analysis in the work of the Abdul Lateef Jamil Poverty Action Lab at the Massachusetts Institute of Technology (MIT), which was established to address poverty in the developing world. Mr. Ludwig discusses how to conduct benefit-cost analysis in determining crime policy. First, he notes that a benefit-cost analysis is only as useful as the quality of the program evaluation upon which it is built. Second, the analysis of evaluation findings must be assigned dollar values. In their presentations, Ms Ander and Mr. Ludwig promote the use of natural experiment designs in lieu of randomized experiments. Natural experiments involve prioritization and then policy changes over time, followed by the challenge of putting dollar values on program impacts. Examples are provided of this type of benefit-cast analysis.

Date Published: February 1, 2011