Exploitative Revenues, Law Enforcement, and the Quality of Government Service

August 11, 2018
By Rebecca Goldstein, Michael W. Sances, and Hye Young You, in the Urban Affairs Review

This study examines the relationships between the collection of fees and fines and criminal investigations by law enforcement, finding that reliance on fee and fine revenue correlates to lower crime closure rates. A growing body of evidence indicates that local police departments are being used to provide revenue for municipalities by imposing and collecting fees, fines, and asset forfeitures. This report examines whether revenue collection activities compromise the criminal investigation functions of local police departments. It finds that police departments in cities that collect a greater share of their revenue from fees solve violent and property crimes at significantly lower rates. The effect on violent crime clearance is more salient in smaller cities where police officers’ assignments tend not to be highly specialized. The report finds that this relationship is robust to a variety of empirical strategies, including instrumenting for fines revenue using commuting time. The results suggest that institutional changes—such as decreasing municipal government reliance on fines and fees for revenue—are important for changing police behavior and improving the provision of public safety.