the economic costs of pretrial detention

The Economic Costs of Pretrial Detention

Will Dobbie Crystal S. YangHKS & NBER HLS & NBER

Spring BPEA ConferenceMarch 25, 2021

Motivation

I The United States has 5% of the world’s population but 25% of itsprison population

I The costs of such mass incarceration likely significant, with anestimated 8 (33) percent of the adult (Black) population having afelony conviction

I We focus on the pretrial (or bail) system, a key part of our criminaljustice system that impacts the 10 million individuals arrested year

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Outline

1 Brief Overview of the Pretrial System

2 National Trends in Pretrial Detention and Economic Outcomes

3 The Economic Consequences of Pretrial Detention

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The Pretrial System in the United States

Arrest Charges Filed Bail Hearing

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Bail Hearing

Detained

Released

Arraignment Trial or Plea Sentencing

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I By law, the bail system is generally meant to accomplish three goals:I Release almost all defendants before trial under reasonable conditionsI Ensure that all defendants appear at court proceedingsI Protect the public by preventing new crime

I However, heated debate on whether system “works” in practiceI Pretrial detention often seems to be the result of poverty, not guiltI Detention can disrupt employment, etc. for those already on the marginI Significantly higher detention rates for minority defendants

I As a result, many jurisdictions are reforming their bail systemsI Risk-based assessment tools to limit judicial discretionI Electronic monitoring and supervised release for low-risk defendantsI Community organizations that post bail for defendants

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Conditions of Release

1. Release on Recognizance (ROR)I Release on promise to return for court with no other conditionsI Used when minimal risk of flight and pose no threat to public

2. Non-Monetary Bail/Conditional ReleaseI Release subject to restrictions like monitoring, halfway houses, etc.I Used when some risk of flight or some threat to public

3. Monetary Bail/Money BailI Release subject to payment of typically 10% of the bail amount; liable

for the remaining 90% if commit a new crime or miss court appearanceI Used when significant risk of flight or threat to the public

4. Denial of BailI Often mandatory in first or second degree murder casesI Used for other crimes when severe risk of flight or threat to the public

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Why the Pretrial System May Affect Economic Outcomes

“Our clients work in service-level positions where if you’re gone for aday, you lose your job...People who live in shelters, where if they misstheir curfews, they lose their housing. Folks with immigrationconcerns are quicker to be put on the immigration radar. So whenour clients have bail set, they suffer on the inside, they worry aboutwhat’s happening on the outside, and when they get out, they comeback to a world that’s more difficult than the already difficultsituation that they were in before.”

– Defense attorney speaking to the NY Times

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Why the Pretrial System May Affect Economic Outcomes

I Partial Equilibrium Effects on Detained IndividualsI Short-run incapacitation effect can result in immediate job lossI Longer-run destabilizing effect can lower labor demand through stigma

of conviction (Pager 2003, Agan and Starr 2018)

I General Equilibrium on Other IndividualsI Spillover effects on family members, friends, communityI Intergenerational effects on children given that majority of detained

have children under 18

I Estimates of just the partial equilibrium effect of pretrial detention ondetained defendants may therefore understate the general equilibriumeffect of pretrial detention policies

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Outline




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Pretrial Detention Rates, 1990–2009

2530

3540

45

Det

entio

n Ra

te (%

)

1990 1995 2000 2005 2010Year

All BlackHispanic White

Note: Data from the State Court Processing Statistics (SCPS). Uses county-year level SCPSweights to report the share of arrested felony defendants detained pretrial in a representativesample of the nation’s 75 most populous counties from 1990-2009.

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Employment-to-Population Ratios, 1990–2010

5055

6065

Empl

oym

ent t

oPo

pula

tion

Ratio

(%)

1990 1995 2000 2005 2010Year


Note: Data from the Bureau of Labor Statistics’ Current Population Survey (Household Survey).

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Poverty Rates, 1990–2010

1020

3040

Pove

rty R

ate

(%)

1990 1995 2000 2005 2010Year


Note: Data from the Census Bureau’s Current Population Survey (Annual Social and EconomicSupplement).

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Outline




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Table: Pretrial Detention and Individual Outcomes from Dobbie, Goldin, andYang (2018)

Detained 2SLS NPVMean Estimates Estimates

Panel A: Binary Outcomes (1) (2) (3)Any Formal Sector Earnings 0.378 -0.094 –

(0.485) (0.057)Any Unemployment Insurance 0.064 -0.013 –

(0.246) (0.033)Any Earned Income Tax Credit 0.233 -0.105 –

(0.423) (0.049)

Panel B: Outcomes in DollarsFormal Sector Earnings 5,887 -948 -18,961

(15,897) (1,128)Unemployment Insurance 245 -293 -5,860

(1,335) (193)Earned Income Tax Credit 357 -209 -4,180

(998) (127)Observations 144,290 334,943 –

Note: All outcomes are measured 3-4 years after an individual’s arrest using administrative taxdata. NPV is calculated using a 3% discount rate, assuming that the gains remain constant.Standard deviations (Column 1) and robust two-way clustered S.E.s (Column 2) are reported.

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I One of the more ambitious reforms under consideration is theelimination of money bail, which would likely reduce detention ratesto approximately 10%

I Our partial equilibrium estimates suggest that such a reduction inpretrial detention would increase aggregate income by up to $80.91billion per year

I A natural question is whether there is a relationship between changesin detention and changes in economic outcomes in the aggregate data

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Changes in County Detention and Poverty Rates

Panel A: All Individuals Panel B: Black Individuals

Broward, FLMiami-Dade, FL

Wayne, MI

Franklin, OH

r = 0.39β = 0.14

-15

-10

-50

510

15

∆ Be

low

Pov

erty

Lin

e 20

00-2

010

Age

25 to

44

(%)

-25 -15 -5 5 15 25 35∆ Detention Rate 2000-2009 (%)


Wayne, MIFranklin, OH

r = 0.56β = 0.24

-15

-10

-50

510

15

∆ Be

low

Pov

erty

Lin

e 20

00-2

010

Blac

k - A

ge 2

5 to

44

(%)

-25 -15 -5 5 15 25 35∆ Detention Rate 2000-2009 (%)

Panel C: Hispanic Individuals Panel D: White Individuals


Wayne, MI

Franklin, OH

r = 0.33β = 0.12

-15

-10

-50

510

15

∆ Be

low

Pov

erty

Lin

e 20

00-2

010

Hisp

anic

- Ag

e 25

to 4

4 (%

)

-25 -15 -5 5 15 25 35∆ Detention Rate 2000-2009 (%)

Broward, FL

Miami-Dade, FL


r = 0.45β = 0.15

-15

-10

-50

510

15

∆ Be

low

Pov

erty

Lin

e 20

00-2

010

Whi

te -

Age

25 to

44

(%)

-25 -15 -5 5 15 25 35∆ Detention Rate 2000-2009 (%)

Note: Changes in county detention and poverty rates from 2000-2009/10 for individuals age25-44. Estimates are weighted using the race/age-specific county population in 2000.

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Changes in County Detention and Employment RatesPanel A: All Individuals Panel B: Black Individuals

Broward, FL

Miami-Dade, FL


r = -0.42β = -0.21

-10

-50

510

15

∆ Em

ploy

men

t Rat

e 20

00-2

010

Age

25 to

44

(%)

-25 -15 -5 5 15 25 35∆ Detention Rate 2000-2009 (%)

Broward, FL

Miami-Dade, FL

Wayne, MI

Franklin, OH

r = -0.48β = -0.21

-10

-50

510

15

∆ Em

ploy

men

t Rat

e 20

00-2

010

Blac

k - A

ge 1

6 to

64

(%)

-25 -15 -5 5 15 25 35∆ Detention Rate 2000-2009 (%)


Broward, FL

Miami-Dade, FL

Wayne, MI Franklin, OH

r = -0.20β = -0.07

-10

-50

510

15

∆ Em

ploy

men

t Rat

e 20

00-2

010

Hisp

anic

- Ag

e 16

to 6

4 (%

)

-25 -15 -5 5 15 25 35∆ Detention Rate 2000-2009 (%)

Broward, FL

Miami-Dade, FL


r = -0.40β = -0.14

-10

-50

510

15

∆ Em

ploy

men

t Rat

e 20

00-2

010

Whi

te -

Age

16 to

64

(%)

-25 -15 -5 5 15 25 35∆ Detention Rate 2000-2009 (%)

Note: Changes in county detention and employment rates from 2000-2009/10 for individualsage 25-44 in Panel A, and age 16-64 in race-specific Panels B-D. Estimates are weighted usingthe race/age-specific county population in 2000.

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I Back-of-the-envelope calculations suggest that the elimination ofmoney bail would have led to counterfactual:

I Poverty rate decrease from 2000–2010 by 0.45–1.58pp for allworking-age, and by 6.67–9.66pp for Black working-age

I Employment rates increase from 2000–2010 by 7.55–10.40pp for allworking-age, and by 7.52–13.80pp for Black working-age

I Decrease in racial gaps in poverty and employment rates

I All of these calculations are larger than the corresponding calculationsbased on our partial equilibrium estimates discussed above

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Detention Rates and Intergenerational MobilityPanel A: All Individuals Panel B: Black Individuals

Orange, CA

Fulton, GA

Suffolk, MA

Essex, NJ

r = 0.13β = 0.02

3540

4550

5560

Mob

ility

at t

he 2

5th

Pare

ntal

Inco

me

Perc

entil

e

-5 5 15 25 35 45 55 65 75 85Detention Rate 1990 (%)

Orange, CA

Fulton, GA

Suffolk, MA

Essex, NJ

r = -0.21β = -0.03

3540

4550

5560

Mob

ility

at t

he 2

5th

Pare

ntal

Inco

me

Perc

entil

e - B

lack

-5 5 15 25 35 45 55 65 75 85Detention Rate 1990 (%)


Orange, CA

Fulton, GA

Suffolk, MAEssex, NJ

r = 0.05β = 0.01

3540

4550

5560

Mob

ility

at t

he 2

5th

Pare

ntal

Inco

me

Perc

entil

e - H

ispan

ic

-5 5 15 25 35 45 55 65 75 85Detention Rate 1990 (%)

Orange, CA

Fulton, GA

Suffolk, MA

Essex, NJ

r = -0.12β = -0.02

3540

4550

5560

Mob

ility

at t

he 2

5th

Pare

ntal

Inco

me

Perc

entil

e - W

hite

-5 5 15 25 35 45 55 65 75 85Detention Rate 1990 (%)

Note: County detention and income percentiles for children born 1978-1983 to parents at the25th income percentile. Estimates are weighted using the race-specific county population in2000.

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Conclusion

I The United States pretrial system is a highly consequential stage thataffects over 10 million arrested individuals each year

I Pretrial detention has a range of long-lasting economic costs that isdisproportionately borne by low-income and minority communities

I Our results suggest that reducing the scope of the pretrial systemwould likely generate significant economic returns

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the economic costs of pretrial detention

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