Can Cost-Benefit Analysis Answer Criminal Justice Policy Questions and If So, How?

• NCJ Number: 206235
• Journal: Journal of Contemporary Criminal Justice Volume: 20 Issue: 3 Dated: August 2004 Pages: 257-275
• Author(s): John Roman
• Date Published: August 2004
• Length: 19 pages
• Publication Format: Article
• Publication Type: Research Paper
• Language: English
• Country: United States of America

Annotation

This article analyzes whether the cost-benefit analysis (CBA) model that is routinely used in crime research can accurately measure the economic effects of criminal justice programs and policies.

Abstract

Cost-benefit analysis on the economic consequences of crime control programming is increasingly being conducted by criminal justice policemakers. A CBA allows decisionmakers to determine whether a program should continue; only those programs with the greatest gains for the smallest investments are often considered worthy of further funding. The problem is the CBA method routinely applied in such research is not an empirically developed method, but an extension of an economic theory. As such, the question should focus on whether the CBA model can accurately measure the economic impacts of criminal justice programs. The typical approach to applying a CBA model to criminal justice program analysis is reviewed and includes the development of an estimate of the program costs through direct observation, semi-structured interviews, and document review. Program benefits are then estimated from the extant literature. Program effects are transformed into estimates of costs and benefits. A CBA of a hypothetical diversion program is presented in order to illustrate the bias inherent in this application of the CBA model. The author outlines five different approaches for translating impact parameters into dollar values. Next, the analysis considers how the introduction of a few rare events can impact the final cost-benefit ratio; such rare events can be magnified within the CBA framework, obscuring all other program effects. The problems inherent in the use of the CBA model for criminal justice program evaluation cannot be overcome through care because any CBA conducted in conjunction with an impact evaluation will necessarily omit critical information. Given the gravity of decisions regarding the public’s safety, it is critical that CBA captures the true effects of crime control programs and policies. Shifting the focus of CBA from individual to community level effects may resolve these problems. Notes, references