March 16, 2010
Existing high-quality research demonstrates that public investment in police can generate substantial social returns, according to a new study by the RAND Corporation.
The study shows how research on the costs of crime and the effectiveness of police—often buried in journals targeted to academics rather than policymakers—can be used to create straightforward and credible cost-benefit analyses of police personnel expenditures.
"Many cities face financial difficulties and have to make tough choices about how to spend taxpayers' money," said Paul Heaton, author of the study and an associate economist with RAND, a nonprofit research organization. "Investing in police makes sense if police can improve the quality of life for ordinary citizens."
"But how much would people value a 10 percent reduction in crime? How many additional officers would it take to reduce crime by that much? Can you quantify the benefits from preventing crime in a way that makes sense and that can be compared to what was spent to hire the additional officers?"
Drawing from existing high-quality research, the study from the RAND Center on Quality Policing shows that in many communities the crime-reduction benefits of employing one additional officer are likely to be several times the budgetary costs of that officer.
"As policymakers make tough spending decisions, they need to recognize that the best available research suggests that police officers generate considerable value in economic terms," Heaton said.
The study reviews the existing research on the cost of crime and the effectiveness of police in preventing crime, and describes some of the common methods available to estimate the cost of crime.
Crime costs are directly borne by victims, insurers, and government, but Heaton notes that it also is important to consider the costs borne by society in general. Additionally, policymakers should consider both the tangible costs, such as a victim's medical bills or lost productivity, as well as the intangible costs, such as a reduced quality of life in a crime-ridden neighborhood.
Applying existing methodologies for estimating the costs of crime to recent crime data suggests that the costs of crime to society are large. For example, the study estimates that in 2006, serious crime cost the residents of Houston $5.7 billion and the residents of Chicago $8.3 billion.
The study also examines research on the effects of police on controlling crime, focusing on those studies that are designed to overcome the "confounding problem," which arises because crimes rates are affected by many other factors besides the number of police, such as population density. Studies that effectively isolate the impacts of additional officers from other factors consistently find that police reduce crime.
Finally, the study applies cost-benefit analyses to two real-world cases: a proposal to increase the police force in Los Angeles, and a proposal to decrease it in Toledo, Ohio. In both cases, analysis shows the benefits of having additional officers and preventing crime outweigh the personnel costs. For example, the study projects that an approximately 10 percent expansion of the police force in Los Angeles, begun in 2005, would generate about $475 million in annual crime reduction benefits, substantially above the $125 million to $150 million annual cost of the officers.
Heaton said every analytical method covered in the study has its pros and cons, and the choice of modeling assumptions will influence the outcomes of the cost-benefit calculations.
"Policymakers need to ask questions about how these studies are designed, because there really isn't a one-size-fits-all template," Heaton said. "If your city has substantial numbers of certain types of crimes—such as fraud or weapons violations—you're going to want to focus on studies with more refined assumptions about the costs of those crimes."
Member agencies of the RAND Center on Quality Policing Research Consortium asked RAND to develop a cost-benefit analysis of police and crime. These include police departments in Chicago, Dallas, Houston, Los Angeles and Miami-Dade, and the Los Angeles County Sheriff's Department. The California Communities Foundation, the Communities Foundation of Texas, the Los Angeles Police Foundation, and the Houston Police Foundation also support the research consortium.
The study, "Hidden in Plain Sight: What Cost of Crime Research Can Tell us About Investing in Police," can be found at www.rand.org.
The Center on Quality Policing is part of the RAND Safety and Justice Program within RAND Infrastructure, Safety and Environment. The center's mission is to help guide the efforts of police agencies to improve the efficiency, effectiveness and fairness of their operations. The center's research and analysis focuses on force planning, performance measurements, cost-effective best practices and the use of technology, as well as issues in police/community relations.