Catching or Fining Speeders: A Political Economy Approach

Eef Delhaye, Stef Proost and Sandra Rousseau

No 543602, Working Papers of Department of Economics, Leuven from KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven

Abstract: According to Becker (1968) it is best to use very high fines and low inspection probabilities to deter traffic accidents because inspection is costly. This paper uses a political economy model to analyse the choice of the fine and the inspection probability. There are two lobby groups: the vulnerable road users and the ‘strong’ road users. If only vulnerable road users are effective in lobbying, we find that the expected fine is higher than if only the interests of car drivers are taken into account. When we consider the choice between inspection probability and the magnitude of the fine for a given expected fine, we find that the fine preferred by the vulnerable road users is higher than socially optimal. The reverse holds if only the car drivers are effective lobbyists. The orders of magnitude are illustrated numerically for speeding and contrasted with current fines for drunk driving in the European Union.

Keywords: Political economy; enforcement; traffic safety (search for similar items in EconPapers)
Date: 2007
Note: paper number ETE WP 2007-02
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Published in Working Papers, pages 1-26

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Related works:
Working Paper: Catching or fining speeders: a political economy approach (2007)
Working Paper: Catching or Fining Speeders: A Political Economy Approach (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:ete:ceswps:543602

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