Abstract

http://ssrn.com/abstract=293153
 
 

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Willingness-to-Pay for Crime Control Programs


Mark A. Cohen


Vanderbilt University - Owen Graduate School of Management; Vanderbilt University - Law School; Resources for the Future

Roland T. Rust


University of Maryland - Robert H. Smith School of Business

Sara Steen


University of Colorado at Boulder - Department of Sociology

Simon T. Tidd


Vanderbilt University - Vanderbilt Institute for Public Policy Studies

November 2001


Abstract:     
This paper reports on a new methodology to estimate the "cost of crime." We adapt the contingent valuation method used in the environmental economics literature to estimate the public's willingness-to-pay for reductions in crime. In a nationally representative sample of 1300 U.S. residents, we found that the typical household would be willing to pay between $100 and $150 per year for crime control programs that reduced specific crimes by 10% in their communities. In the aggregate, these amounts imply a marginal willingness-to-pay to reduce crime of about $31,000 per burglary, $75,000 per serious assault, $253,000 per armed robbery, $275,000 per rape and sexual assault, and $9.9 million per murder. Consistent with economic theory and rational behavior, willingness-to-pay generally increases with both income and the risk of victimization. The new estimates are between two and ten times higher than prior estimates of the cost of crime to victims and are thought to more fully represent the true cost of crime to society. By focusing exclusively on costs to victims of crime and the criminal justice system, previous studies have ignored many other social costs of crime.

Number of Pages in PDF File: 46

Keywords: economics of crime, contingent-valuation, willingness-to-pay, cost of crime

JEL Classification: K14, K42, H43

working papers series





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Date posted: December 11, 2001  

Suggested Citation

Cohen, Mark A. and Rust, Roland T. and Steen, Sara and Tidd, Simon T., Willingness-to-Pay for Crime Control Programs (November 2001). Available at SSRN: http://ssrn.com/abstract=293153 or http://dx.doi.org/10.2139/ssrn.293153

Contact Information

Mark A. Cohen (Contact Author)
Vanderbilt University - Owen Graduate School of Management ( email )
401 21st Avenue South
Nashville, TN 37203
United States
615-322-0533 (Phone)
HOME PAGE: http://www.mba.vanderbilt.edu/faculty/mcohen.cfm
Vanderbilt University - Law School
131 21st Avenue South
Nashville, TN 37203-1181
United States
Resources for the Future ( email )
1616 P Street, NW
Washington, DC 20036
United States
202-328-5000 (Phone)
Roland T. Rust
University of Maryland - Robert H. Smith School of Business ( email )
College Park, MD 20742-1815
United States
Sara Steen
University of Colorado at Boulder - Department of Sociology ( email )
Boulder, CO 80309
United States
303-492-6427 (Phone)
Simon T. Tidd
Vanderbilt University - Vanderbilt Institute for Public Policy Studies ( email )
1207 18th Avenue South
Nashville, TN 37212
United States
615-322-8508 (Phone)
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References:  41
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