Fines, Non-Payment, and Revenues: Evidence from Speeding Tickets

Christian Traxler and Libor Dušek

No 23, Berlin School of Economics Discussion Papers from Berlin School of Economics

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.

Keywords: Fines; Timely Payment; Speeding Tickets; Regression Discontinuity Design (search for similar items in EconPapers)
JEL-codes: H26 H27 K42 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2023-07-31
New Economics Papers: this item is included in nep-law
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:bdp:dpaper:0023

DOI: 10.48462/opus4-5046

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