FISCAL STRESS AND THE PRODUCTION OF PUBLIC SAFETY - A DISTANCE FUNCTION-APPROACH

Faced with increasing crime rates, but nonincreasing budgets, local go vernments are seeking cost saving means of providing public safety. Th is paper investigates a bureaucracy's response to fiscal stress as wel l as its ability to efficiently substitute civilian for uniformed pers onnel. Exploiting duality theory, a distance function is used to model technology, retrieve information concerning substitutability and shad ow prices of personnel, and test for cost minimization. Morishima elas ticities are adopted to allow for asymmetry in substitution between ty pes of personnel. It is found that the more adverse the public safety environment and budgetary condition, the more efficiently resources ar e allocated.