01519588

Component

Policymakers around the globe have opted for high levels of regulation of the market for vehicle safety and declared many vehicle safety systems as mandatory for new cars. In this paper the authors argue that the delivered justifications for these policies are at least questionable. The authors add a completely new argument to the discussion and show in a simple theoretical model that vehicle safety systems might cause positive externalities. Based on a large dataset of traffic accidents in Germany the authors show that the these externalities in fact occur. Based on the authors' estimation results the authors show that for anti-lock-brakes (ABS)and electronic stability programmes (ESP) the average expected externality exceeds the price of these systems. Thus, the obligation to equip any new car with both ABS and ESP is adequate from an allocative point of view although the official justification for the introduction of these regulations are flawed.

This paper was sponsored by TRB committee AL070 Tort Liability and Risk Management. Alternate title: Positive Externalities from Active Car Safety Systems: New Justification for Car Safety Regulations

01503729

14-1478

English

24p

2014

Transportation Research Board 93rd Annual Meeting

Digital/other

Figures; Maps; References; Tables

Active safety systems; Antilock brake systems; Externalities; Policy; Regulations; Traffic safety

Electronic stability control

Germany

Highways; Policy; Safety and Human Factors; I10: Economics and Administration; I91: Vehicle Design and Safety

Transportation Research Board Annual Meeting 2014 Paper #14-1478

PRP, TRIS, TRB, ATRI

Jan 27 2014 2:33PM