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Penalty-point system, deterrence and road safety: A quasi-experimental analysis

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  • Rebollo-Sanz, Yolanda
  • Rodríguez-López, Jesús
  • Rodríguez-Planas, Núria

Abstract

We use three complementary quasi-experimental approaches to study the causal effect of introducing a penalty-point system (PPS) in Spain in July 1 2006, on drivers' behavior. According to Regression-Discontinuity (RD) estimates, the PPS decreased the number of traffic offenders by 14%, and this deterrence effect was directly related to the severity of the penalty. Concerns that RD estimates may over- or under-state the longer-run effects of the policy change are addressed by presenting the Difference-in-Differences (DiD) estimates, which reveal that the deterrence effect of this reform increased over time. Crucially, the reform also curbed accidents by 14%, injuries by 16%, and fatalities by 14%, and these effects persisted over time. Difference-in-RD estimates are consistent with the other two approaches. Altogether, the reform represented net benefits of over 946 million EUR per year (or 0.09% of the Spanish GDP) during the first three years after implementation.

Suggested Citation

  • Rebollo-Sanz, Yolanda & Rodríguez-López, Jesús & Rodríguez-Planas, Núria, 2021. "Penalty-point system, deterrence and road safety: A quasi-experimental analysis," Journal of Economic Behavior & Organization, Elsevier, vol. 190(C), pages 408-433.
    • Handle: RePEc:eee:jeborg:v:190:y:2021:i:c:p:408-433
    DOI: 10.1016/j.jebo.2021.08.007
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    More about this item

    Keywords

    Regulation and drivers behavior; Incentives; Public policy impacts; Deterrence effect;
    All these keywords.

    JEL classification:

    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • R4 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics

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