The effects of private prison labor program participation on inmate recidivism /

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Hopper, Jeffrey
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Middle Tennessee State University
The United States is experiencing a persistent increase in its prison population and, consequently, a steady increase in public spending on incarceration. One possible change to mitigate these trends is a return to historically cost effective inmate labor programs. Thus, the primary focus of this dissertation is on potential cost savings and inmate recidivism reduction from the Prison Industry Enhancement Certification Program (PIE), a program that allows private companies to employ inmates while incarcerated.
Existing economics of crime models and human capital theories form the foundation for the hypothesis that training and education efforts result in a reduction of inmate recidivism. The theories suggest that increasing the returns to legal activities should raise the opportunity costs of illegal activities and thus the agent will far legitimate, rather than criminal, activities. There is, however, the theoretical possibility that a prison training program may lower the cost of crime and therefore increase first offense rates.
The historical basis for the use of inmate labor in the United States is explored as is the body of literature tied to inmate rehabilitation efforts and recidivism. The conclusion is that more thorough and effective analytical techniques would improve these assessments.
The PIE program's effectiveness in reducing recidivism is explored using prisoner data from the Tennessee and Indiana Departments of Corrections. Contingency tables examine inmate characteristics and identify PIE participation as a potential explanitor of recidivism. Logit regression procedures, including an instrumental variable procedure to address endogeneity, are used to analyze the predictive value of the dependent variables and quantify the reduction in the odds of inmate recidivism attributable to PIE program participation. The results indicate that PIE participation contributes to a statistically significant reduction in the odds of inmate recidivism.
Given the conclusion of PIE effectiveness, a potential framework for policy analysis is presented. A net return to participation model highlights the private benefits (including increased savings, future wages, education levels and employment probability) and social benefits (including increased tax revenues, victims' restitution, family support, and decreased incarceration costs) of the program. The monetary benefits are approximated to illustrate potential differences between participants and non-participants.
Adviser: Richard L. Hannah.