THE EFFECT OF PRISON POPULATION-SIZE ON CRIME RATES - EVIDENCE FROM PRISON OVERCROWDING LITIGATION

Simultaneity between prisoner populations and crime rates makes it dif ficult to isolate the causal effect of changes in prison populations o n crime. To break that simultaneity, this paper uses prison overcrowdi ng litigation in a state as an instrument for changes in the prison po pulation. The resulting elasticities are two to three times greater th an those of previous studies. A one-prisoner reduction is associated w ith an increase of fifteen Index I crimes per year. While calculations of the costs of crime are inherently uncertain, it appears that the s ocial benefits associated with crime reduction equal or exceed the soc ial costs of incarceration for the marginal prisoner.