BURGLAR AND FIRE ALARMS - COSTS AND BENEFITS TO THE LOCALITY

The alarm industry has been estimated at 8-11 billion dollars in 1993. There are approximately 17 million alarms installed nationwide. The a nnual growth of installations has been 8 percent over the last five ye ars. At the same time, the number of false activations per system is 1 .1 to 1.4 per year, with 20 to 30 percent of police manpower devoted t o false activations. 94-98 percent of all activations are false. Indee d, false activations pose a severe problem for local police department s which respond with stiff fines for false activations and reduced res ponse to alarm activations in general which are not high risk such as jewelry stores, banks or government facilities. This paper identifies the social benefits and costs which result from burglar and fire alarm s in a given community. Included benefits are reduced burglary, assaul t, and rape incidents as well as fewer incidents of fire which are det ected early and controlled. Costs include police response to alarms, c osts of installation and monthly monitoring fees. The results demonstr ate that, indeed, burglar and fire alarms provide a net social benefit to the locality. The paper suggests that charges for false alarms sho uld be allocated directly to the police which service them. Such users ' fee method will improve resource allocation, and prevent a situation where alarms become useless.