Evaluation of automobile safety regulations: The case of compulsory seat belt legislation in Australia

A basic tenet of the new conservatism in political economy is that government policies frequently lead to unintended consequences which may offset the benefits of the policy. Auto safety legislation may be a case in point. As the first country to make the wearing of seat belts compulsory, Australia is highly suitable as a case study. Traffic accident casualties were regressed on six independent variables for the pre-seat belt period 1949–71. The equations were then used to predict casualties for the period 1972–77, using the actual values of the independent variables. In the aggregate, predicted occupant casualties were higher than the actual rates, whereas non-occupant casualties were underpredicted by the equations. An additional test, using a dummy variable to predict the effect of seat belts, supported these conclusions. The results are consistent with the hypothesis that drivers respond to a reduction in risk by increasing driving intensity, shifting some of the welfare cost of auto safety legislation on to non-occupants, whose casualty rates are higher than they would have been in the absence of seat belt legislation.I am grateful to Chris Adam and to an anonymous reviewer for helpful comments and suggestions.