Skip to main content
U.S. flag

An official website of the United States government

Cost-Benefit Analysis and Justice Policy Toolkit

"Justice policymakers must make tough choices with limited resources. To help weigh their options, decision makers are increasingly turning to cost-benefit analysis (CBA), an economic tool that compares the costs of programs or policies with the benefits they deliver. This emerging demand for justice CBA means that many researchers are being called upon to conduct these studies for the first time and are looking for resources to help them get started. A common misconception is that you can perform CBA by inputting data into a common set of formulas. In reality, there is no one-size-fits-all template. Each analysis must be tailored to the investment being studied. There is, however, a common CBA methodology, or series of steps, you must follow to produce cost-benefit results. The purpose of this toolkit is to guide justice analysts through these steps. It is not intended to be a comprehensive treatment of CBA methods" (p. 4). Sections cover: introduction; overview of cost-benefit analysis; before you get started; Step 1: Identify the investment’s potential impacts; Step 2: Quantify the investment’s impacts; Step 3: Determine marginal costs; Step 4: Calculate costs, benefits, and net present value; Step 5: Test the assumptions; Step 6: Report the results; and using CBA to inform policy and practice.