Prison Crime and the Economics of Incarceration.

• Author: Gifford, Ben
• Position: III. Accounting for Prison Crime through Conclusion, with appendix, footnotes, and tables, p. 103-135

Part 2 of 2

3. Accounting for Prison Crime

   1. A Flaw in the Economic Framework

      Scholars and policymakers account for myriad costs and benefits when conducting analyses involving the economics of incarceration. One item, however, is almost always excluded: crime that occurs inside prisons and jails. (188) This exclusion is significant, as "[c]rime does not stop at the door of the prison," (189) but is instead shifted to some degree from society at large to the world behind bars. (190) To the extent that prison crime should be included in our calculus, its exclusion therefore creates an artificially favorable picture of policies that increase the incarceration rate. (191) This exclusion correspondingly creates an artificially unfavorable picture of laws and programs that reduce recidivism--such as those discussed in Parts II.B.2 and II.B.3 above--as it understates the benefits to society of keeping people out of prison.

      Conceptually, there are two ways in which we might include prison crime in our estimates of incarceration's costs and benefits. First, we could include prison crime when calculating the benefits of avoided victimization. If we calculated the net benefits of victimization avoided through increased incarceration--accounting not only for the decreased victimization outside of prison, but also the increased victimization inside of prison--then the benefits of incarcerating the marginal inmate would decrease. Conversely, the benefits of reducing recidivism would increase, as victimization would be avoided both outside and inside of prison. Second, we could include the costs of prison crime in our estimates of the costs of incarceration (in addition to those categories of costs already aggregated in Part I.B above), thereby causing these cost estimates to increase.

      In practice, neither of these approaches has been adopted by scholars or policymakers. Instead, when analysts of either stripe measure the crime-prevention effect of incarceration, they look only to crime prevented "out on the street" (192) or "in the community." (193) Crime that occurs within prisons is ignored. In some cases, the exclusion of prison crime appears to be unconscious; analysts simply equate "crime" with "crime outside of prison." (194) In other cases, the exclusion is acknowledged, although with varying degrees of explicitness. (195)

      Similarly, prison crime is almost entirely absent from the literature on the costs of incarceration. As discussed in Part I.B above, empirical work on incarceration costs tends to quantify government expenditures and lost inmate productivity, (196) with additional rough estimates provided for the collateral costs that incarceration imposes on inmates' families and communities. (197) Although scholars often reference inmates' lost freedom as a potential cost of incarceration (198)--and although this freedom should presumably include freedom from victimization in prison--few attempts have been made to quantify freedom's value, (199) and even those scholars who reference lost freedom rarely discuss prison crime specifically. (200) Indeed, there appears to be only one recent study that has tried to quantify the costs of incarceration inclusive of prison crime, (201) and even that study calculates only the costs associated with prison rape and sexual assault, excluding the costs associated with all other types of prison crime. (202)

      Policy applications are no different in this regard. In many of the examples cited in Part II above, the costs of incarceration are limited to include only direct government expenditures. (203) Furthermore, even in those applications that do account for other social costs of incarceration--such as lost inmate productivity, or the collateral costs imposed on prisoners' families and communities--there is no discussion of victimization in prison or jail. (204)

      It is hard to know why prison crime is so widely excluded from analyses involving the economics of incarceration, but there are two likely explanations: First, from a pragmatic standpoint, the major public data sources for reported crime in the United States do not include crime that occurs within prisons and jails. (205) As a result, the multitude of studies and applications that rely on these data sources when calculating elasticities of crime with respect to incarceration omit the impact of incarceration on prison crime. Relatedly, statistics on prison crime are often based on surveys and are thus subject to a number of reporting difficulties, (206) especially given that "snitching" is often met with retaliation from fellow inmates. (207) To the extent that analysts find self-report studies to be unreliable, they may be less inclined to use them.

      Perhaps more significant than these pragmatic problems are the normative decisions that analysts make to discount the costs associated with prison crime. (208) These decisions are rarely articulated explicitly, but they appear to rest on the view that criminals have given up their right to be free from suffering, (209) or that crimes are better imposed on convicted criminals than on innocent civilians. (210) Although such views may find support in our popular discourse, (211) they are fundamentally misguided, as they fail to accord victims of prison crime appropriate standing in our cost-benefit analyses. As the next Subpart will illustrate, an adequate theory of standing requires us to include all private harms in our economic analyses unless there is a normative justification for excluding them. Part III.C will then argue that attempts to justify the exclusion of prison crime--such as those just mentioned--are questionable at best and fatally flawed at worst.

   2. Who Has Standing in Our Cost-Benefit Analyses?

      Underlying the question of prison crime's role in the economics of incarceration is the more fundamental question of who has standing in our cost-benefit analyses. (212) The concept of economic standing parallels that of legal standing and was discussed briefly above in the contexts of the social costs of theft (213) and lost freedom. (214) In assessing who has economic standing, analysts must define "whose [costs and] benefits are to count in the summation of costs and benefits to individuals affected by a project or policy." (215) Or, more precisely, analysts must define which costs and benefits are to count, as individuals may have standing with respect to some preferences but not others. (216) Issues of standing are thus logically prior to issues of measurement methodology, such as whether to use a "bottom-up" or "top-down" approach when calculating the magnitude of the crime-prevention effect (217) or the costs of crime. (218)

      For economists, the default position when conducting cost-benefit analyses is to accord standing to "every member of society." (219) While this expansive view might seem to offer an easy answer regarding the proper treatment of prison crime, it really just raises the further question: Who counts as a "member of society"? As we saw in the previous Subpart, prison crime is often distinguished from crime in society or "in the community," (220) but this distinction is rarely explained. The default position provides no additional guidance in this respect, (221) and it fails as a result to help us decide which costs and benefits to include in our analyses.

      Another major problem with the default position is that it counts all preferences equally, regardless of how unworthy they may seem. We saw this issue briefly in the context of theft, where some economists have argued that the costs suffered by victims are offset by the benefits that accrue to thieves. (222) The difficulties become even starker when we consider crimes like rape or murder. Should we really say that society benefits from the enjoyment that a perpetrator gets when committing such gruesome acts? (223) According to the default view, the answer is yes: Criminals' enjoyment should be taken into account when setting our optimal law enforcement policy. (224) For many scholars, however--and probably for most nonacademics--treating the satisfaction of such criminals' preferences as an economic gain is normatively unacceptable. (225) A satisfactory theory of standing should thus provide a principled basis for distinguishing costs and benefits that count from those that do not.

      Although the literature on economic standing is not particularly well developed, roughly two different frameworks have been proposed for making such distinctions. The first, which I will call the normative framework, suggests that we should rely on ethical judgments when deciding which costs and benefits to include in our economic analyses. This view is attributable to Dale Whittington and Duncan MacRae, Jr., who started the debate on economic standing in their article "The Issue of Standing in Cost-Benefit Analysis." (226) According to Whittington and MacRae, analysts should aim to "express the ethical consensus of a society" when deciding issues of standing. (227) Whether to account for prison crime, on the normative view, thus reduces to whether society assigns a negative value to the harms associated with victimization behind bars. There will of course be disagreement about how analysts should discern society's values--Whittington and MacRae suggest appealing to "public discussion and democratic debate" (228)--but determinations of standing are, on the normative view, fundamentally moral inquiries.

      In opposition to the normative framework is what I will call the positive framework, according to which judgments of standing are taken to be natural consequences of the existence of certain institutions. One of the primary proponents of the positive view is Bill Trumbull, who has argued that standing decisions should flow logically from "social constraints" like laws or regulations. (229) Another notable positivist is Richard Zerbe, who has sought to cast economic standing in terms of "the pattern of...