A guide on how to determine costs and benefits of crime prevention

This report aims to clarify the economic benefits and costs of crime prevention. It was compiled for the Danish Crime Prevention Council and TrygFonden by senior adviser Rasmus Højbjerg, Copenhagen Business School. As well as offering benefits on the basic human level, a successful crime prevention initiative can also benefit society. This report seeks to highlight these benefits on the basis of three crime prevention initiatives. 

This note has described in detail how to find the relevant data for the effects and costs of a program and how to use these data to carry out a cost-benefit analysis.

Advantages of using cost-benefit analyses
The main advantage of using cost-benefit analysis is that it results in a single number that answers the question of whether the program is economically worthwhile. This single number has an intuitive appeal and may be used as an important argument when deciding which specific programs to implement.
There are also other advantages of using CB-analysis, for instance it can be carried out at many different levels such as local, regional, national or even international level. It also provides a clear indication of the net cost-benefit of a specific area or regulation by helping to justify decisions at different levels. A CB-analysis simplifies complex concepts and processes and it is more readily accepted by society than any other economic evaluation methods.

Limitations and pitfalls
There are some disadvantages of using CB-analysis as well. For instance, it can be difficult to find out the exact discount rate of future costs and benefits, as well as indirect impacts. Also the analysis could take more time to complete than expected and become a time-consuming and expensive process. Moreover, the CB-analysis does not usually consider questions of justice with respect to how costs and benefits are distributed across various groups, as well as the source of the costs and benefits.
More specifically, regarding the all crime-costing studies, especially in the (K. E. McCollister, M. T. French, H. Fang, 2010)-article, it is mentioned that there also could be some limitations in quantifying the actual number of offenses for crimes (i.e. drug law violations and prostitution, etc.) and their consequent exclusion from the CB-analysis. One more limitation is the exclusion of some important variables from the estimates presented in their article such as the costs of psychological injury.


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