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Annual Economics Conference Highlights Mass Incarceration

How America’s vast criminal justice system harms us all was spotlighted at the world’s largest meeting of economists.

  • Matthew Friedman
March 8, 2017

Every year, the Allied Social Science Asso­ci­ation (ASSA) hosts the world’s largest gath­er­ing of econom­ists, aver­aging more than 13,000 attendees from all around the world. This year’s event took place this past Janu­ary, in Chicago.

As usual, there was ample discus­sion of interest rates, GDP growth, and wage gaps. Nobel laur­eates grappled with one another over the impact of economic stim­u­lus and monet­ary policy.

Unlike past confer­ences, though, dozens of econom­ists atten­ded to discuss mass incar­cer­a­tion, a topic that might seem out of place for the event. It’s a remark­able change from a decade ago, when not a single paper, panel, or poster presen­ted at the confer­ence dealt with it.

Mass incar­cer­a­tion is now recog­nized soci­ety-wide as a legit­im­ate and signi­fic­ant economic issue. Not only does it affect GDP and labor, but economic prin­ciples like cost-bene­fit analysis can help inform possible solu­tions. Amer­ica now spends more money to lock up its own citizens than most counties alloc­ate towards fight­ing foreign threats, surpass­ing  the national defense budgets of all but two nations (the U.S. and China).

In light of the substan­tial resources being alloc­ated towards it, it is only natural that experts would ask whether our crim­inal justice system achieves its goals.

The Bren­nan Center has helped lead the way in explor­ing this ques­tion, launch­ing a track of research on the topic and form­ing an Economic Advis­ory Board to engage lead­ing econom­ists from across the polit­ical spec­trum. The board aims to develop a broader under­stand­ing of how mass incar­cer­a­tion depresses the economy, and how the crim­inal justice system can be changed for the better.

Last year, the Pres­id­ent’s Coun­cil of Economic Advisers (CEA), Bren­nan Center, and the Amer­ican Enter­prise Insti­tute (AEI) hosted an event bring­ing together lead­ing experts to discuss the applic­a­tion of econom­ics to crim­inal justice reform. That event cata­logued at length the “unin­ten­ded consequences, failed policies and heart­break­ing waste” asso­ci­ated with Amer­ica’s crim­inal justice system.

This year’s ASSA confer­ence pushed the conver­sa­tion further. As the Bren­nan Center’s Econom­ics Fellow, I moder­ated a conver­sa­tion on “the crim­inal justice system’s impact on employ­ment, equal­ity, and growth” and previewed our upcom­ing research on the topic. Over a period of two hours we dived into nearly half-a-dozen major topics of interest, high­light­ing the academic consensus that, for example, harsh sentences do not effect­ively deter crime. The discus­sion revealed a broad agree­ment among econom­ists that current crim­inal justice policies are ripe for improve­ment, and that economic tools have a role to play in devis­ing policy solu­tions.

Other experts held similar conver­sa­tions, present­ing their find­ings in sessions titled “Peer Effects in the Crim­inal Justice System” and “Econom­ics of Crime,” reflect­ing a new way of think­ing about how our soci­ety enforces laws and punishes those who break them. Histor­ic­ally, the tradi­tions of legal and soci­olo­gical thought have pushed us to talk about the impris­on­ment of fellow citizens with terms like “justice,” “equal­ity,” and “fair­ness.” The sheer scale of Amer­ica’s use of inca­pa­cit­a­tion through deten­tion as a crim­inal sanc­tion has made it neces­sary to now think about this prob­lem in terms of “effi­ciency.”

One of the most talked-about topics was new research on the effic­acy and unin­ten­ded consequences of so-called “Ban the Box” laws. Research by Daniel Shoag, a Harvard Univer­sity econom­ist, and his co-author Stan Veuger of the Amer­ican Enter­prise Insti­tute, showed that “ban-the-box: regu­la­tions increase employ­ment of resid­ents living in high-crime areas. However, the results were not unequi­vocal: they found that employ­ers tended to raise exper­i­ence require­ments in the wake of such laws. This unin­ten­ded effect may explain why Jennifer Doleac and Ben Hansen, two econom­ists whose work appeared in a differ­ent session at the ASSA confer­ence, found that in some cases ‘ban-the-box’ regu­la­tions dimin­ished the employ­ment prospects of young, low-skilled black and Hispanic men without a record of crim­inal activ­ity.

The atten­tion econom­ists heaped on these issues signals a grow­ing recog­ni­tion that mass incar­cer­a­tion can and should be looked at through an economic lens. This year’s confer­ence was a chance for some of Amer­ica’s bright­est minds to think crit­ic­ally about and define how, rather than what, poli­cy­makers ought to think about Amer­ica’s crim­inal justice system.

As more scientific resources and public atten­tion is direc­ted toward issues related to mass incar­cer­a­tion, we will be better equipped to under­stand its consequences and better prepared to mitig­ate them with precisely designed policy inter­ven­tions. 

Photo credit: Amer­ican Economic Asso­ci­ation