According to a 2003 report, research showed that private prisons save money, as well as put pressure on the public prison system, constraining the escalation of costs. Data showed that states using private prisons had more success in keeping public corrections spending under control than states with no private prisons.
States with less than 5 percent of their prison populations in private facilities experienced a 12.5 percent increase in expenditures versus an 18.9 percent increase in those states with no private prisons. States with larger percentages under private management had even greater savings with growth in expenditures at only 5.9 percent during the period studied.
In a 2008 study, evidence indicated that states can save a substantial amount of money if they use a shared system of both privately and publicly managed prisons. The research showed that during the study period (1999–2004), states were able to save up to $15 million on their yearly corrections budget by using at least some privately managed prisons. The study was overseen by James Blumstein, director of the Health Policy Center, Vanderbilt Institute for Public Policy Studies.
Economic benefits to local communities that house private partnership prisons include employment of hundreds of local workers, payment of property taxes and utilities, and purchasing goods and services locally.
Commentators and human rights activists have raised concerns about the morality of imprisoning humans for profit. Traded on the New York Stock Exchange, investors have an interest in keeping private prisons filled. Industry experts say a profitable prison must have a 90-95 percent capacity rate. In a 1990's report, Prudential Securities was bullish on CCA but noted, "It takes time to bring inmate population levels up to where they cover costs. Low occupancy is a drag on profits... company earnings would be strong if CCA succeeded in ramp(ing) up population levels in its new facilities at an acceptable rate".
Jenni Gainsborough of the ACLU's National Prison Project notes "[There is a] basic philosophical problem when you begin turning over administration of prisons to people who have an interest in keeping people locked up