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Pay-as-you-speed:An economic field-experiment

Lars Hultkrantz and Gunnar Lindberg ()
Additional contact information
Gunnar Lindberg: VTI, Postal: Dept. of Transport Economics, P.O. Box 55685, SE-102 15 Stockholm, Sweden

No 2009:8, Working Papers from Swedish National Road & Transport Research Institute (VTI)

Abstract: We report a vehicle-fleet experiment with an economic incentive given to car drivers for keeping within speed limits. A pay-as-you-speed traffic insurance scheme was simulated with a monthly participation bonus that was reduced by a non-linear speeding penalty. Actual speed was monitored by a GPS in-vehicle device. Participating drivers were randomly assigned into two-by two treatment groups, with different participation-bonus and penalty levels, and two control groups (high and low participation bonus, but no penalty). A third control group consists of drivers with the same technical equipment who did not participate but whose driving could be monitored. We evaluate changes in behaviour from twelve-month differences in proportion of driving time per month that the car was exceeding the maximum allowed speed on the road. We find that the participating drivers significantly reduced severe speeding violations during the first experiment month, while in the second experiment month, after having received feedback reports with an account of earned payments, only those participating subjects that were given a speeding penalty reduced severe speed violations. We find no significant effects from the size of the participation bonus (high vs. low), or the size of the penalty (high vs. low rate).

Keywords: Traffic insurance; traffic safety; Intelligent Transport Systems; ITS; Intelligent Speed Adaptation; ISA (search for similar items in EconPapers)
JEL-codes: H23 I18 K42 R41 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2009-08-26
New Economics Papers: this item is included in nep-exp, nep-ias and nep-ure
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http://www.transportportal.se/SWoPEc/Hultkrantz_Lindberg_2009.pdf (application/pdf)

Related works:
Journal Article: Pay-as-you-speed An Economic Field Experiment (2011) Downloads
Working Paper: PAY-AS-YOU-SPEED: AN ECONOMIC FIELD-EXPERIMENT (2009) Downloads
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