by Harris Kenny, Leonard Gilroy
January 09, 2014
Eight percent of inmates in the U.S. federal and state prison system are housed in privately operated correctional facilities. Yet there remains debate over the relative cost of public and private prisons. Some research suggests that governments can save money through public-private partnerships; other research finds that the cost difference is negligible or that public sector delivery is cheaper. One of the primary reasons for this disparity is different budgeting and accounting practices in the public and private sectors, which make “apples-to-apples” comparisons difficult and often distort cost comparisons in favor of the public sector.