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Fines, nonpayment, and revenues: evidence from speeding tickets

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  • Traxler Christian
  • Dušek Libor

Abstract

We estimate the effect of the level of fines on payment compliance and revenues collected from speeding tickets. Exploiting discontinuous increases in fines at speed cutoffs and reform-induced variation in these discontinuities, we implement two complementary regression discontinuity designs. The results consistently document small payment responses: a 10% increase in the fine (i.e., the payment obligation) induces a 1.2 percentage point decline in timely payments. The implied revenue elasticity is about 0.9. Expressed in absolute terms, a one-dollar increase in the fine translates into a roughly 60-cent increase in payments collected within 15 days (JEL H27, H26, K42).

Suggested Citation

  • Traxler Christian & Dušek Libor, 2025. "Fines, nonpayment, and revenues: evidence from speeding tickets," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 41(2), pages 381-401.
    • Handle: RePEc:oup:jleorg:v:41:y:2025:i:2:p:381-401.
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    File URL: http://hdl.handle.net/10.1093/jleo/ewad025
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    More about this item

    JEL classification:

    • H27 - Public Economics - - Taxation, Subsidies, and Revenue - - - Other Sources of Revenue
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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