This study examines the effects of capacity-oriented and institutional-based factors on the proliferation of prison privatization by extending the first generation of empirical research. This study found that correction expenditures, prison capacity, and regional identity are factors that significantly affect the magnitude of prison privatization, whereas political pressures, government ideology, and unionization were found not to have a significant influence on the growth of private prisons. The results imply that, once adopted, prison privatization became institutionalized over time and suggest that state governments should develop well-structured evaluation systems for private prisons to ensure and maintain effective correction management.