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Buckle up or slow down? New estimates of offsetting behavior and their implications for automobile safety regulation

  • Robert S. Chirinko
  • Edward P. Harper

This study provides a detailed examination of the determinants of motor vehicle fatalities and offers a new assessment of the effects of automobile safety regulation. An empirical analysis is difficult because drivers are unlikely to remain passive in the face of changes in their safety environment. This offsetting behavior hypothesis is cast in a broad framework that brings together elements from the economics and cognition literatures. This approach allows us to highlight key maintained assumptions in previous analyses and to consider how econometric evidence can inform discussions about highway safety policy. The econometric estimates reveal that, while imprecisely estimated, offsetting behavior is quantitatively important and attenuates the effects of safety regulation on total motor vehicle fatalities. Cognitive elements, the relative costs of repairs, and the functional form of the estimating equation are shown to play prominent roles in the analysis of safety regulation. Our estimates imply that current highway policy initiatives-mandating restraint systems and relaxing restrictions on the maximum speed limit-are likely to have only a modest net effect on reducing motor vehicle fatalities.

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File URL: http://hdl.handle.net/10.2307/3325236
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Article provided by John Wiley & Sons, Ltd. in its journal Journal of Policy Analysis and Management.

Volume (Year): 12 (1993)
Issue (Month): 2 ()
Pages: 270-296

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Handle: RePEc:wly:jpamgt:v:12:y:1993:i:2:p:270-296
Contact details of provider: Web page: http://www3.interscience.wiley.com/journal/34787/home

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  1. Arrow, Kenneth J, 1982. "Risk Perception in Psychology and Economics," Economic Inquiry, Western Economic Association International, vol. 20(1), pages 1-9, January.
  2. Layson, Stephen K & Seaks, Terry G, 1984. "Estimation and Testing for Functional Form in First Difference Models," The Review of Economics and Statistics, MIT Press, vol. 66(2), pages 338-43, May.
  3. Crandall, Robert W & Graham, John D, 1984. "Automobile Safety Regulation and Offsetting Behavior: Some New Empirical Estimates," American Economic Review, American Economic Association, vol. 74(2), pages 328-31, May.
  4. V. Kerry Smith & William H. Desvousges & F. Reed Johnson & Ann Fisher, 1990. "Can public information programs affect risk perceptions?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 9(1), pages 41-59.
  5. Blomquist, Glenn C, 1979. "Value of Life Saving: Implications of Consumption Activity," Journal of Political Economy, University of Chicago Press, vol. 87(3), pages 540-58, June.
  6. Cornell, N. & Noll, Roger G. & Weingast, B., . "Safety Regulation," Working Papers 122, California Institute of Technology, Division of the Humanities and Social Sciences.
  7. Colin F. Camerer & Howard Kunreuther, 1989. "Decision processes for low probability events: Policy implications," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 8(4), pages 565-592.
  8. Machina, Mark J, 1987. "Choice under Uncertainty: Problems Solved and Unsolved," Journal of Economic Perspectives, American Economic Association, vol. 1(1), pages 121-54, Summer.
  9. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-38, May.
  10. Peltzman, Sam, 1975. "The Effects of Automobile Safety Regulation," Journal of Political Economy, University of Chicago Press, vol. 83(4), pages 677-725, August.
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