| Abstract: | The purpose of this article is to discuss some basic methods for optimally allocating federal money to cities. Optimally allocating in this context means using the quantitative methods of operations research, management science, and related fields in order to allocate federal money to cities in such a way as to (1) maximize benefits subject to a given budget, (2) minimize costs subject to a minimum satisfaction level, or (3) maximize benefits minus costs. The basic methods include (1) allocating by marginal rates of return, which partly relies or statistical regression analysis; and (2) allocating by part/whole percentages, which partly relies on ideas associated with multiattribute utility theory. The basic methods will be illustrated with the example of allocating anticrime dollars to cities, although one could easily reason by analogy to allocation in any subject matter area. |
