To Encourage or Not to Encourage Seat Belt Use: Simultaneity Bias and Offsetting Behaviour

Anindya Sen () and Brent Mizzen
Additional contact information
Brent Mizzen: Department of Finance, Government of Canada

No 2003, Working Papers from University of Waterloo, Department of Economics

Abstract: Estimating the efficacy of seat belt use is important as compensating risk-taking or "offsetting behaviour" by drivers may attenuate benefits from vehicle safety regulation. However, evidence on partial-offsetting behaviour from previous studies may simply reflect simultaneity bias, as increasing deaths from traffic accidents results in tougher policies aimed at encouraging seat belt use. We find significant evidence of such measurement error. OLS estimates from Canadian provincial data between 1980 and 1996 imply partial offsetting behaviour as increased average seat belt use over the sample period resulted in a 13.42% decline in vehicle occupant fatalities, in contrast to the expected 39-46% drop. However, corresponding instrumental variables (IV) estimates imply a lack of significant risk compensation as increased seat belt use is associated with a 37% fall in occupant deaths.

Date: 2002-01, Revised 2002-01
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wat:wpaper:02003

Access Statistics for this paper

More papers in Working Papers from University of Waterloo, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Sherri Anne Arsenault ().