Blog: Security is a Market Product

It is often taken as a given that the government is what creates order and peace in society. Sometimes, this is assumed merely because police and prisons exist, but…

1) Expenditures on police and corrections are less than 200 billion annually.

2) Total private expenditures on crime prevention are roughly* 460 billion, plus numerous hours of volunteered time, such as neighborhood watch groups or personal defense improvement.

3) Assume the market is more efficient than governments. (for myriad reasons, ranging from the fact that private actors spend their own money while government agents spend others’, to the calculation problem).

Conclusion

Almost all security and prevention for domestic crime in the U.S. is produced privately.

*I could find no studies that estimated total private crime prevention expenditures for years earlier than 1996 (Philipson and Posner). When adjusted for inflation using CPI to the same year as the government expenditure source above, 460 billion is the result.

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