Do Private Prisons Affect Criminal Sentencing?

Christian Dippel, Michael Poyker

NBER Working Paper No. 25715
Issued in March 2019
NBER Program(s):Law and Economics, Labor Studies, Public Economics, Political Economy

This paper provides causal evidence of the effect of private prisons on court sentencing, using novel data on private prisons and state trial courts. Our identification strategy uses state-level changes in private-prison capacity and compares changes in sentencing only across court pairs that straddle state borders. We find that the opening of a private prison increases the length of sentences relative to what the crime’s and defendant’s characteristics predict. Effects are concentrated at the margin of sentence length, not of being sent to prison. The effect does not appear to be driven by ‘judicial capture’; instead the evidence is most consistent with the cost savings from private prisons leading judges to pass longer sentences. Private prisons do not appear to accentuate existing racial biases in sentencing decisions.

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Document Object Identifier (DOI): 10.3386/w25715