Private Crime Prevention Expenditure in Fiji

Abstract

ecently, the Prime Minister of Fiji and the Police Commissioner have made statements to the effect that criminal activity in Fiji has been declining and that the incidence of crime in Fiji is lower than in Australia and New Zealand. Indeed, despite the reports of crime that feature large in the local media, the crime statistics do show a decline in the incidence of crime in recent years. But while the incidence of crime may be falling and may be lower than in Australia and New Zealand, this is not the full story. From casual observation it would appear that there is large private expenditure on security to protect homes and businesses from theft and personal assault in the form of protective fences, security grilles, security alarm systems, and security guards. This private expenditure can be seen as an indication of the ineffectiveness of public security, or at least an indication that the public holds the perception that public security is ineffective. Criminal activity may be declining but this may be because the private expenditure on crime prevention is high and rising. Thus, the broader and more relevant question is: what are the costs, both public and private, of the declining incidence of criminal activity? State provision of public security in the form of police forces and the accompanying deterrence mechanisms of courts and prisons is justified as a public good because of the positive externalities that arise from public provision of these services. However, if the public feels that the state is not providing a sufficiently high level of security, there will be private expenditure to supplement the public expenditure. For individual businesses such as banks, the level of public security provided will usually not be high enough, given the costs that such businesses could incur from the failure of the public security. Hence, we observe high levels of expenditure in making businesses such as banks more secure than people’s residences.