NCJ Number
64249
Date Published
1979
Length
18 pages
Annotation
LITERATURE WHICH CONSIDERS CRIME COSTS IN TERMS OF CONCEPTS FROM ECONOMIC ANALYSIS IS REVIEWED IN ORDER TO SUGGEST AN ECONOMIST'S APPROACH AND FRAMEWORK FOR SUCH ANALYSIS.
Abstract
CRIME ENTAILS SUBSTANTIAL RESOURCE ALLOCATION EFFECTS, INCLUDING PUBLIC EXPENDITURES FOR THE CRIMINAL JUSTICE SYSTEM. INTELLIGENT PUBLIC POLICY DECISIONS CONCERNING SUCH EXPENDITURES REQUIRE KNOWLEDGE OF BOTH CRIME COSTS AND POTENTIAL BENEFITS FROM CRIMINAL JUSTICE SYSTEM EXPENDITURES. ECONOMISTS HAVE RARELY BEEN CONSULTED FOR THEIR VIEWS ON SUCH COSTS AND BENEFITS, NOR, UNTIL RECENTLY, HAVE THEY EXPLORED RESOURCE ALLOCATION IN CRIME AND CRIMINAL JUSTICE. AN ECONOMIC APPROACH TO THIS SUBJECT MUST BEGIN WITH PRECISE DEFINITION OF THE CONCEPTS INVOLVED. IN ECONOMIC TERMS, CRIME IS AN ACTIVITY WHICH GENERATES AN UNCOMPENSATED EXTERNAL COST. AN EXTERNAL COST IS ONE INCURRED BY SOMEONE NOT VOLUNTARILY PARTICIPATING IN AN ACTIVITY. IT IS PART OF THE CRIME'S SOCIAL COST, WHICH IS THE REDUCTION IN SOCIETAL WELL-BEING GENERATED BY CRIME. THE CRIMINAL JUSTICE SYSTEM'S GOAL IS TO MINIMIZE THE SOCIAL COSTS OF CRIME. CRIME COSTS INCLUDE THE PUBLIC AND PRIVATE COSTS OF PROTECTION AND COSTS OF VICTIMIZATION. THE GOALS OF EFFICIENCY (CRIME MINIMIZATION) AND EQUITY (EQUAL RISK OF CRIME) MAY BE MUTUALLY EXCLUSIVE AS WELL AS INCONSISTENT WITH COMMUNITY PREFERENCES. ALTHOUGH THE PUBLIC SECTOR SHOULD PROVIDE CRIMINAL JUSTICE, ALL PRODUCTION NEED NOT BE PUBLIC. A MAJOR PROBLEM IS DECIDING HOW MUCH CRIMINAL JUSTICE TO PROVIDE AND HOW MUCH TO CHARGE VARIOUS CUSTOMERS. STUDIES OF THE ECONOMIC IMNPACT OF ILLEGAL ACTIVITY HAVE BEEN HAMPERED BY THE DIVERGENCE BETWEEN PREVAILING CONCEPTS OF CRIME AND DEFINITIONS AMENABLE TO COST CONSIDERATION. MUCH ADDITIONAL RESEARCH IS THEREFORE NEEDED. FIGURES, TABLES, NOTES, AND A REFERENCE LIST ARE INCLUDED. (AUTHOR ABSTRACT MODIFIED--CFW)