By Andra Ghent
America spends a lot of money locking up a lot of people. Understandably, legislators are trying to find ways of cutting prison costs without increasing crime rates. One tactic legislators increasingly rely on to manage costs is private prisons. Research from the Sentencing Project shows that, between 1999 and 2010, the share of U.S. prisoners housed in private prisons grew by more than 50%. What those prisons need, however, is an incentive to do better than public institutions—and a hint from a successful part of the U.S. education system.
Legislators are right to harness the power of market incentives to reduce costs. Given the right economic incentives, the private sector can be more efficient and creative than government.
Yet private prisons are failing to do the two things they should do best: reducing costs and recidivism rates. Research from Yale University has shown that, after controlling for demographics and the type of crime committed, private prisons have higher recidivism rates than government-run prisons. Research from the University of Wisconsin has also shown that, compared with publicly operated prisons, private-prison inmates serve a larger fraction of their sentences and are more likely to receive an infraction for poor behavior that can prolong their prison stay.
While the Wisconsin research didn’t pinpoint the source of the increased infractions, there are two reasons private prisons have higher infractions. First, private prisons earn more revenue when inmates serve more of their sentence. Second, private prisons’ cost-cutting measures—such as reduced staffing and more cramped quarters—lead to more violence among inmates.