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Income, Income Inequality and the “Hidden Epidemic” of Traffic Fatalities

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  • Nejat Anbarci

    (Department of Economics, Florida International University)

  • Monica Escaleras

    ()
    (Department of Economics, Florida Atlantic University)

  • Charles Register

    (Department of Economics, Florida Atlantic University)

Abstract

Few, if any, epidemics responsible for 20 million severe injuries and/or deaths each year, globally, receive less public attention than do traffic accidents truly making them a “hidden epidemic”. Worse yet, the epidemic is growing as evidenced by World Health Organization data which show deaths from traffic accidents increasing by 20 percent between 1990 and 2002. In this paper we examine how a country’s stage of development and its distribution of income affect its traffic fatality rate. In our theoretical analysis, we show that traffic fatalities should have a nonlinear relationship with a country’s level of per capita income while being a decreasing function of income equality. We test our model’s predictions by evaluating data from 79 countries between 1970 and 2000, taking into account other factors that influence traffic fatalities like the motorization rate, health care networks, education, and alcohol consumption and find strong evidence of the theoretical model’s predictions. Specifically, the empirical results indicate that traffic fatalities are negatively related to income equality throughout its range and also are negatively related to per capita income, above a threshold of about $11,500.

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File URL: http://home.fau.edu/mescaler/web/working%20papers/traffic-8.8.06.pdf
File Function: Revised version, 2006
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Bibliographic Info

Paper provided by Department of Economics, College of Business, Florida Atlantic University in its series Working Papers with number 05002.

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Length: 43 pages
Date of creation: Nov 2005
Date of revision: Aug 2006
Handle: RePEc:fal:wpaper:05002

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Keywords: Vulnerable road users; traffic safety interventions; per capita income; income inequality;

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  1. Angus Deaton, 2003. "Health, Inequality, and Economic Development," Journal of Economic Literature, American Economic Association, vol. 41(1), pages 113-158, March.
  2. Deininger, Klaus & Squire, Lyn, 1996. "A New Data Set Measuring Income Inequality," World Bank Economic Review, World Bank Group, vol. 10(3), pages 565-91, September.
  3. Christopher J. Ruhm, 1995. "Alcohol Policies and Highway Vehicle Fatalities," NBER Working Papers 5195, National Bureau of Economic Research, Inc.
  4. Benson, Bruce L. & Rasmussen, David W. & Mast, Brent D., 1999. "Deterring drunk driving fatalities: an economics of crime perspective1," International Review of Law and Economics, Elsevier, vol. 19(2), pages 205-225, June.
  5. Jennifer M. Mellor & Jeffrey Milyo, 1999. "Re-Examining the Evidence of an Ecological Association between Income Inequality and Health," Discussion Papers Series, Department of Economics, Tufts University 9922, Department of Economics, Tufts University.
  6. Chaloupka, Frank J & Saffer, Henry & Grossman, Michael, 1993. "Alcohol-Control Policies and Motor-Vehicle Fatalities," The Journal of Legal Studies, University of Chicago Press, vol. 22(1), pages 161-86, January.
  7. Kopits, Elizabeth & Cropper, Maureen, 2003. "Traffic fatalities and economic growth," Policy Research Working Paper Series 3035, The World Bank.
  8. Alma Cohen & Liran Einav, 2003. "The Effects of Mandatory Seat Belt Laws on Driving Behavior and Traffic Fatalities," The Review of Economics and Statistics, MIT Press, vol. 85(4), pages 828-843, November.
  9. Brent D. Mast & Bruce L. Benson & David W. Rasmussen, 1999. "Beer Taxation and Alcohol-Related Traffic Fatalities," Southern Economic Journal, Southern Economic Association, vol. 66(2), pages 214-249, October.
  10. McCarthy, Patrick S, 1996. "Market Price and Income Elasticities of New Vehicles Demand," The Review of Economics and Statistics, MIT Press, vol. 78(3), pages 543-47, August.
  11. Waldmann, Robert J, 1992. "Income Distribution and Infant Mortality," The Quarterly Journal of Economics, MIT Press, vol. 107(4), pages 1283-302, November.
  12. Dee, Thomas S., 1999. "State alcohol policies, teen drinking and traffic fatalities," Journal of Public Economics, Elsevier, vol. 72(2), pages 289-315, May.
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