BJS also produces annual estimates of federal, state,  and local governments’ criminal justice costs. Such costs include  the value of damaged property, medical care to treat injuries, and  costs to install alarm systems to avoid crime. Other costs occur as a response to  crime, such as the cost of judicial proceedings or the costs to  incarcerate offenders. It has been the  basis for better understanding criminal  victimization in the United States. Researchers Use Differing Approaches and Face Numerous Challenges, Leading to Disagreement on Cost Estimates

Based on a survey of experts associated with the cost of crime and a  review of literature in the field, we found that there is no commonly used  approach for estimating the costs of crime. We identified four primary  methods to estimate costs. In addition, some  experts told us that current methodologies are inadequate to fully  estimate costs. As a result of these challenges, research has  produced widely varying estimates on the costs of crime. Measuring crime’s economic effect on markets. Using jury awards to estimate victimization costs. Calculating categories of costs separately to develop a total  cost. For example, one expert stated that many studies  that use surveys to estimate the public’s willingness to pay to reduce  crime develop their estimates on the basis of the public’s perception  of crime and not the actual magnitude of crime. Experts Identified Approaches that Could Improve the Understanding of the Cost of Crime and Its Use in Policy Discussions

Experts we surveyed for this report provided five broad topic areas that  may help improve the understanding of the cost of crime. Further, experts noted that researchers could  refine their estimates by combining different methodological approaches. Cost of punishment and incarceration. Cost of potential bias in the administration of justice. Appendix II: Bibliography of Research on the Cost of Crime

We reviewed and analyzed 27 research studies on estimating the cost of  crime in the United States, published from 1996 to April 2017. (2) What actions have experts considered in order to improve the  understanding and use of cost of crime research? Scope of Crimes and Costs

For purposes of this report, we focused on crimes committed in the  United States. To identify various  categories of crime, we relied on information from Department of Justice’s  (DOJ) Office of Justice Programs (OJP), the Federal Bureau of  Investigation (FBI), and a study released by the National Academies of  Sciences, Engineering, and Medicine (National Academies), which FBI  and OJP commissioned in 2013. These fields include economics, criminology,  demography, sociology, public health, and computer science;
Knowledge on specific or technical aspects of estimating various  costs of crime, such as statistics on the prevalence of crime, methods  used to estimate the cost of crime, and experience or knowledge of  the full range of crimes and challenges estimating costs for these  crimes; and
For participants with criminology expertise, experience with different  aspects of assessing various costs of crime, such as the effects of  crime on offenders, victims, and communities, corporate and white- collar crime, recidivism, substance abuse, mental illness, juvenile  delinquency, policing, and mass incarceration. The structured questionnaire included questions about existing research  studies, methods used to estimate the cost of crime and the advantages  and challenges of each method, challenges creating estimates for certain  costs and certain crimes, challenges identifying the magnitude of crime,  how cost of crime estimates can be used in criminal justice policy  decisions, and what can be done to improve cost of crime estimates.
Why GAO Did This Study

Crime and society's response to it pose significant costs to the United States. The Department of Justice's Bureau of Justice Statistics reported that federal, state, and local governments collectively spent over $280 billion in fiscal year 2012 (adjusted to 2016 dollars) on criminal justice programs such as police protection, the court system, and incarceration. There are also many other financial and nonfinancial effects of crime that researchers consider when estimating the total costs of crime in the United States. These can include tangible costs such as replacing damaged property or medical care to treat victims' injuries, and intangible costs such as changes in people's behavior to avoid crime, among many other costs. Researchers have estimated varying annual costs of crime, including totals of $690 billion, $1.57 trillion, and $3.41 trillion, adjusted to 2016 dollars.
GAO was asked to examine issues related to estimating the costs of crime committed in the United States. This report examines: 1) how experts estimate the cost of crime in the United States, and the challenges they face, and 2) the actions experts have considered in order to improve the understanding and use of cost of crime research. To answer these questions, GAO worked with the National Academies of Sciences, Engineering, and Medicine to identify and survey experts in fields associated with estimating the cost of crime, including criminology, economics, public health, public policy, and statistics, among others. GAO also reviewed 27 studies that estimated the cost of crime in the United States, published from 1996 to 2017.

What GAO Found

Based on a survey of experts associated with studying the costs of crime and a literature review, GAO found that there is no commonly used approach for estimating the costs of crime, and experts face multiple challenges when making estimates. GAO identified four primary methods to estimate costs, each with limitations: 1) measuring effects on markets, 2) using jury awards, 3) surveying the public for its willingness to pay to reduce crime, and 4) calculating individual categories of cost to develop a total cost. Experts stated that current methodologies are inadequate to fully estimate costs and that they face numerous challenges in developing estimates, such as the value of intangible costs of crime. As a result, research has produced widely varying and inconsistent estimates on the costs of crime.
Experts provided five broad areas they believe warrant further study to improve understanding of the costs of crime: 1) costs of crimes not reported to law enforcement agencies, 2) costs of punishment and incarceration, 3) costs of recidivism, 4) costs of potential bias in the administration of justice, and 5) uncertainty of cost estimates. Further, experts noted that researchers could refine estimates by combining different methodological approaches. They urged researchers to consider cost of crime estimates under different policy scenarios, such as in setting sentencing guidelines, to help better inform policy decisions.