A report by the Institute for Public Policy Research (IPPR) suggests restorative justice as a way of empowering communities and an alternative to arrest.
It argues that the causes of offending in communities can be tackled more effectively by partnerships with schools within the community.
It also calls for government to consider adopting a system similar to that of Scotland featuring a preventative and diversionary approach and a civil-style youth court.
Carey Oppenheim, co-director of IPPR, said the current approach to youth justice relies heavily on police targets for people being brought to justice.
"Our research shows that this has not resulted in a reduction in crime but serves to criminalise children, increases re-offending as a result, and misdirects important resources away from dealing with severe offences and crime prevention," she said.
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