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Do Policymakers Locate Prisons for Economic Development?

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  • Todd Cherry

Abstract

While public goods can provide an overall increase in welfare, 'inferior' public facilities produce externalities specifically impacting host locations. Heterogeneous jurisdictional attributes, however, can cause net social benefits to vary across potential host communities. Using data from a unique public works project, this paper empirically investigates whether policymakers consider heterogeneous conditions when locating prison facilities. Results indicate that policymakers follow a process that maximizes net social benefits by systematically delegating such facilities to lagging communities; thereby potentially using the public facilities for economic development. Additionally, results suggest that policymakers properly consider existing infrastructure and agglomeration economies in the siting mechanism. Copyright 2001 Gatton College of Business and Economics, University of Kentucky.

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Article provided by Gatton College of Business and Economics, University of Kentucky in its journal Growth and Change.

Volume (Year): 32 (2001)
Issue (Month): 4 ()
Pages: 533-547

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Handle: RePEc:bla:growch:v:32:y:2001:i:4:p:533-547

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