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The Monopoly Economics Of Juvenile Custody: Could Private Competition Keep Costs Down?

IP-15-88 (July 1988)
Author: Rex Reed and David W. Holm

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Colorado’s legislature and governor disagree about a one-year experiment to contract out a twelfth of the juvenile custody caseload to a private company in Brush. The plan, which would cut that has risen at nearly 13% a year since 1982, is up for veto override in early August. Policy analysts Reed and Holm provide background for the controversy by asking whether the 76% cumulative jump in juvenile custody coa=sts (four times the inflation rate during this period) doesn’t indicate monopolistic behavior by state government. Would a dose of competition be the antidote taxpayers are looking for?