Abstract:
This case is designed to raise issues having to do with privatization of public services. It describes the early history of Corrections Corporation of America, a Nashville, Tennessee company devoted to the ownership (or leasing) and management of detention and corrections institutions. The case discusses the political, legal, and economic difficulties facing our prison system and outlines how the entrepreneurs who founded CCA propose to alleviate them and at the same time make a reasonable profit.
Learning Objective:
The case asks the student to consider the nature of the problems facing the public sector institutions in question and the appropriateness of the privatization alternative, appraising the risks and opportunities that privatization poses for each side. It gives the class the opportunity to consider the question of whether there is, in fact, a tradeoff between quality and efficiency. Assuming privatization takes place, the student is asked what continuing role the public sector should play and how the public's and prisoners' interests can best be protected over the long run.
