Could Cash Incentives Lower Recidivism?

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Photo by Alan Levine via Flickr

Paying NGOs bonuses for each week “they manage to keep formerly imprisoned persons in their charge alive and out of the criminal justice system” could help reduce America’s recidivism rates, says a senior research fellow at the American Institute of Economic Research.

Robert E. Wright, an author of books on history and economics, says the high U.S. rate of re-arrests for offenses ranging from parole violations to the commission of new crimes represents a systemic failure.

“High recidivism rates are taken to mean that the criminal justice system is failing in one of its primary missions, to rehabilitate criminals so that they become ‘productive members’ of society,” he wrote in an essay posted online.

According to the National Institute of Justice, some 44 percent of released prisoners return behind bars within a year of release, and 68 percent are rearrested within three years, according to 2005 figures..

Later collected data from individual states shows some improvement, but the U.S. still has some of the highest recidivism rates in the world

Justice advocates say education and employment counseling —specifically training for decently paid jobs—are the most effective means of addressing recidivism.

Private non-government agencies and services have had more success than government programs but they have been poorly compensated for their efforts, Wright said.

Singling out two successful nonprofit programs, the DOE Fund and the Prison Entrepreneurship Program (PEP), Wright noted they are hampered by a lack of funds.

He proposed what he called a “cost-benefit” approach that uses monetary incentives to reward success. Payments would be based on an individual agency’s ability to keep the individuals in its charge from returning to prison, assessed on a weekly basis.

It would reward the most successful entrepreneurial programs, and allow them to grow faster, he wrote.

Wright cited a pilot program at HMP Doncaster, a privately operated prison in the UK, called Pay by Result (PbR) which has reduced recidivism by over 5 percent. The prison contracts with an NGO called Catch 22 to run a rehabilitation and counseling program.

The 5 percent reduction is “a considerable achievement in the context of Britain’s prison system, which is almost as brutal and ineffective as that of the United States,” Wright argued.

Encouraging privatized employment training and counseling programs would effectively force government authorities to take a back seat.

“Governments would still fund rehabilitation services, just not necessarily provide them itself or via contracts that pay for inputs instead of performance,” Wright said, noting that FIPs (Formerly Imprisoned Persons) and inmates tend not to trust government institutions or personnel.”

He added: “Many Black men, for example, will not take part in prison-run training or education programs due to a profound, and many would argue rationally justified, sense of mistrust of government authorities.”

Wright argues that traditional punishment-oriented methods of combating recidivism are short sighted.

Robert E. Wright. Courtesy AIER

Most people can identify and value the difference between a single-month sentence and a 30-year sentence, Wright reports. But, change that to the difference between a 20- and 30-year sentence, and the difference is “relatively negligible.”

To this point, Wright notes that longer sentences don’t always garner the desired anti-recidivism response.

“The social benefits of longer sentences are therefore quite low, but the social costs are enormous,” Wright explains.

Because of this, Wright details possible policy alternatives rather than relying on longer sentences as a form of criminal punishment with the goal of changing their behavior.

While longer sentences aren’t the answer, Wright says that education alone is far from the remedy.

It has been proven that prisoners who complete GED and university programs while incarcerated experience lower levels of recidivism because the newfound credentials increase opportunities after release.

However, “trying to reduce recidivism with education alone can backfire.”

Wright also notes that sometimes, educational programs are low-quality, wasting the monetary resource and not reducing any recidivism rates of the program graduators.

Overall, as Robert Toney, chaplain at Louisiana’s infamous Angola Prison, put it as quoted by Wright, “…if you just have education, what you have done is just created a smarter criminal. Change must come from within.”

Prison Entrepreneurship Program Case Study

Created in 2004 by Catherine Rohr, Prisoner Entrepreneurship Program (PEP) helps male prisoners in Dallas and Houston through a rigorous nine-month program teaching business skills to help them gain employment.

Upon successful completion, prisoners earn an entrepreneurship certificate from Baylor’s Hankamer School of Business — giving them a credential to help them navigate the post-release world after incarceration.

Wright says the vast majority of its 1,300 plus graduates obtained employment or achieved proprietorship within 90 days of release — and a year later almost all remained employed. To add to this success, over 200 graduates run their own business, many of them then employing other PEP graduates.

The recidivism rates demonstrate the success of PEP.

“The three-year recidivism rate among PEP graduates is only 7 percent, far less than the half to two-thirds rate experienced by non-PEP graduates,” Wright details.

Researchers are now trying to scale the PEP model, bringing it to female prisons and teaching them leadership and entrepreneurship skills to fill those roles.

As with most non-governmental programs though, funding and resources constrict rapid expansion.

According to a recent study, PEP runs on under $3 million a year, including $300,000 spent on fundraising alone — where almost all of the income derives from private donations.

“What is needed is a way for successful non-government organizations to obtain the funds they need to grow,” the essay said.


Wright said simple duplication of the PEP or other models isn’t the answer.

“My policy proposal is not to proclaim, ‘Let’s Copy This!’ as many do after they hear about PEP and the DOE Fund for the first time,” he said.

“Rather than encourage a specific X, Y, or Z, policymakers should create private incentives to reduce recidivism by allowing governments to contract with nonprofit recidivism reduction organizations like the DOE Fund and PEP.”

In other words, by offering a monetary incentive for lower recidivism rates, it will inspire governments to work with programs proven to decrease recidivism.

The UK pilot program was on the right track, but Wright points out that the financial incentives for success were “relatively weak.”

Closer to home, Wright used an example from California, which enticed counties to reduce their criminal recidivism rates by saying they could retain 40 to 45 percent of savings if they met targets. However, there was a major problem, as law enforcement officers began overlooking probation and parole violations, as well as minor re-offenses to save money.

Instead, Wright suggests, that a sponsoring organization would pay each week that an individual remains “alive and out of legal trouble.”

The benefits of the weekly payment basis is that they’re not paid on an “all-or-nothing” measurement, but rather, it incentivizes real aid.

Wright notes that the money would be used to improve and scale the programs.

“In other words, some people (FIPs, NGOs, taxpayers, and people who would have been victimized by re-offenders) would be made better off while nobody, including for-profit prisons and the criminal justice-industrial complex, is made worse off, they simply have their unjustifiable economic rents reduced,” Wright concluded.

“Gains are achieved by incentivizing all relevant parties to achieve the common goal of desistance/recidivism reduction without imposing specific approaches or creating expensive bureaucratic screening or monitoring structures.”

Download the full paper here.

Andrea Cipriano is a TCR staff writer.

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