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Traffic safety: Speed limits, strict liability and a km tax

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  • Delhaye, E.
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    Abstract

    This paper focuses on two specific determinants of accidents: speed and the activity level. If there is no government intervention, people do not take into account the full cost of their driving and they will drive too fast and too much. In our setting, the government can use three instruments to influence the behaviour of people: speed limits, strict liability and a kilometre tax. We analyse the choice of the speed and activity level under the different instruments and determine the optimal combinations. Given our assumptions we never reach the social optimum. The results are illustrated with a numerical example.

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    Bibliographic Info

    Article provided by Elsevier in its journal Transportation Research Part A: Policy and Practice.

    Volume (Year): 40 (2006)
    Issue (Month): 3 (March)
    Pages: 205-226

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    Handle: RePEc:eee:transa:v:40:y:2006:i:3:p:205-226

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    1. A. Mitchell Polinsky & Steven Shavell, 1999. "The Economic Theory of Public Enforcement of Law," NBER Working Papers 6993, National Bureau of Economic Research, Inc.
    2. Keller, Wouter J., 1976. "A nested CES-type utility function and its demand and price-index functions," European Economic Review, Elsevier, vol. 7(2), pages 175-186, February.
    3. Peirson, John & Skinner, Ian & Vickerman, Roger, 1998. "The Microeconomic Analysis of the External Costs of Road Accidents," Economica, London School of Economics and Political Science, London School of Economics and Political Science, vol. 65(259), pages 429-40, August.
    4. Eef Delhaye, 2004. "Traffic safety: speed limits, strict liability and a km tax," Energy, Transport and Environment Working Papers Series, Katholieke Universiteit Leuven, Centrum voor Economische Studiën, Energy, Transport and Environment ete0407, Katholieke Universiteit Leuven, Centrum voor Economische Studiën, Energy, Transport and Environment.
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    Cited by:
    1. Albalate, Daniel & Bel, Germà, 2012. "Speed limit laws in America: The role of geography, mobility and ideology," Transportation Research Part A: Policy and Practice, Elsevier, Elsevier, vol. 46(2), pages 337-347.

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