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Bunching on the Autobahn? Speeding Responses to a 'Notched' Penalty Scheme

Author

Listed:
  • Christian Traxler
  • Franz Westermaier
  • Ansgar Wohlschlegel

Abstract

This paper studies drivers’ responses to a ‘notched’ penalty scheme in which speeding penalties are stepwise and discontinuously increasing in speed. We present survey evidence suggesting that drivers in Germany are well aware of the notched penalty structure. Based on a simple analytical framework we analyze the impact of the notches on drivers’ optimal speed choices. The model’s predictions are confronted with data on more than 150,000 speeding tickets from the Autobahn and 290,000 speed measures from a traffic monitoring system. The data provide evidence on modest levels of bunching, despite several frictions working against it. We analyze the normative implications and assess the scope for welfare gains from moving from a simple, notched penalty scheme to a more complex but less salient Pigouvian scheme.

Suggested Citation

  • Christian Traxler & Franz Westermaier & Ansgar Wohlschlegel, 2017. "Bunching on the Autobahn? Speeding Responses to a 'Notched' Penalty Scheme," CESifo Working Paper Series 6786, CESifo.
  • Handle: RePEc:ces:ceswps:_6786
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    Cited by:

    1. Panagiota Papadimitri & Ansgar Wohlschlegel, 2020. "Lobbying and Enforcement: Theory and Application to Bank Regulation," Working Papers 2020-01, Swansea University, School of Management.
    2. Jason Bantjes & Sophia du Plessis & Ada Jansen & Krige Siebrits, 2021. "Better enforcement is essential, but may be inadequate: Findings of a survey on the factors affecting payment of speeding fines in Cape Town, South Africa," Working Papers 03/2021, Stellenbosch University, Department of Economics.
    3. Stefano Castriota & Mirco Tonin, 2019. "Stay or Flee? Probability Versus Severity of Punishment in Hit-And-Run Accidents," CESifo Working Paper Series 7907, CESifo.
    4. Jason Bantjes & Sophia du Plessis & Ada Jansen & Krige Siebrits, 2021. "Better Enforcement Is Essential, but May Be Inadequate: Findings of a Survey on the Factors Affecting Payment of Speeding Fines in Cape Town, South Africa," Sustainability, MDPI, Open Access Journal, vol. 13(9), pages 1-16, April.
    5. Aney, Madhav S. & Ho, Christine, 2019. "Deadlier road accidents? Traffic safety regulations and heterogeneous motorists’ behavior," Regional Science and Urban Economics, Elsevier, vol. 77(C), pages 155-171.

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    More about this item

    Keywords

    notches; speeding tickets; stepwise penalty function; salience;
    All these keywords.

    JEL classification:

    • K40 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - General
    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation

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