Developing estimates of the economic costs of crime

The project aim was to develop estimates of the economic costs of crime in Hungary. The researchers were interested in finding out what the costs of crime are to the community, at a social level. In September 2009 Hungarian researchers with the assistance of experts from the United Kingdom have taken stock of the data accessible from the existing data systems and sources in Hungary and they have come to the conclusion that there is place for developing estimates based on the existing data. 

At the same time, from the comparison of the costs of crime and the amount spent by the state, we can establish that state expenditure in dealing with crime (326 billion HUF) is around 100 billion HUF higher than the amount of damage caused by crime (235 billion HUF). The amount of expenditure society devotes to law enforcement and crime prevention cannot be analysed simply by comparison with the costs of crime, as it is not possible to demonstrate the effect of crime which is not committed because of the threat of punishment and becauseof crime prevention measures. It is in the fundamental interests of the state and all members of society to act against those members of society who follow the path of crime, even if the actions are extremely costly. This basic "zugzwang" in practice means that there is no upper limit to spending on crime. The amounts spent by individual states on fighting and punishing crime are not decided on the basis of cost-efficiency analysis, but on social and political factors. This does not in any way mean, however, that efficiency can be ignored in this area. The calculations we have made of the costs could represent the first step on the path leading to better awareness of the importance of the role of crime in society. The calculations and methods used are, even in our opinion, open to debate, and should be debated too, but we are convinced that there is a place in this field for calculating and deliberating economic costs