Do We Need Speed Limits to Drive Safely?

A recent RegBlog post discussed a paper by van Benthem, which suggested that the social costs of higher speed limits outweigh their benefits. The paper examines the data from a natural experiment – the repeal of National Maximum Speed Law in 1995 that led many states to increase speed limits – to make its point. Yet, both the RegBlog post and the paper miss the larger question: lower driving speeds may be safer, but do we need the government-imposed speed limits to drive at safe speeds?

In the study, van Benthem finds that “a 10 mph speed limit increase on highways leads to a 3-4 mph increase in travel speed, 9-15% more accidents, 34-60% more fatal accidents.” Thus, he concludes that the difference between private benefits and social costs of faster driving provide a strong rationale for speed limits (while the paper looks at both traffic fatalities and increasing pollution levels, I focus on traffic safety. As the RegBlog post points out, there are alternatives to speed limits to deal with pollution, e.g. emission standards).

However, there is a natural experiment that van Benthem does not discuss: only a third of highways in Germany (mostly around urban areas) have permanent speed limits. On the remaining portion of highways, drivers choose their own speed. The data indicate that there is little difference between traffic fatality rates on highways with and without speed limits. In fact, over the last 20 years, the number of highway traffic fatalities in Germany decreased by 71% despite a 17% increase in number of vehicles on the road and a 25% increase in traffic flow. At 5.6 deaths per billion vehicle-kilometers driven, Germany’s traffic fatality rate is lower than the US rate (6.83) or even France’s (7.01). Apparently, German drivers are able to choose safe driving speeds even without government prodding.

Entrusting drivers with responsibility for their own safety and safety of those around them is behind another natural experiment adopted in several European cities – the concept of shared spaces. These cities are doing away with a thicket of street signs, streetlights and in some cases even sidewalks on some busy intersections. Instead, cars and pedestrians share the road, negotiating their ways as they go. While this may sound like a disaster waiting to happen, the cities report fewer accidents and increased foot traffic in businesses along the roads. The key to the concept’s success comes from drivers’ psychology; drivers compensate for lack of predictable traffic rules by paying attention to their surroundings and being more considerate to others. As Hans Monderman, a proponent of shared spaces, points out “The many rules strip us of the most important thing: the ability to be considerate… The greater the number of prescriptions, the more people’s sense of personal responsibility dwindles.”

For social regulation proponents, stringent rules are the go to response to all social ills. Yet, as European experiences with traffic demonstrate, regulation is not the only and may not even be the best alternative. Crazy as it may sound to some, treating people as responsible adults and trusting them to make the right choices may in fact lead to better social outcomes for all.