Shorten their sentences; trade time in custody for parole. Prisoners should always be rewarded for good behavior. That’s the finding of a recent economic analysis by Stanford Law School professor Mitchell Polinsky, who determined that the cost savings of certain enticements for good behavior outweigh the downside of lowering deterrence with those incentives. 

An expert in applying economic theory to law, Polinsky has long been interested in the prison system and its costs. His paper, to be published in the International Review of Law and Economics, notes that U.S. federal, state and local governments spend billions on corrections—$75 billion in 2008, for example—mostly on incarceration. And maximum-
security prisons cost much more than standard facilities.

“I thought, ‘There must be a way to make the prison system more efficient,’ ” Polinsky says. “If we could get prisoners to behave better, we could save a lot of money in the process.”

The paper looks at three types of rewards for good behavior: time off a sentence; replacing prison time with parole; and in-prison privileges, such as greater access to athletic facilities or more family visitation. The greatest savings, Polinsky found, come with time off; parole is second best. There are no clear savings from in-house privileges.

Polinsky’s work assumes the purpose of prison is to deter crime; he doesn’t take into account the view that prison is meant to keep lawbreakers off the streets. The next step, Polinsky says, is for other scholars to test his theoretical analysis on real-world data.