This report builds on research reported earlier, on the cost of the lack of traffic safety, and the resulting social cost-effectiveness of investments into a `sustainably safe' road traffic system. This is recapitulated, and is placed into an international perspective. It is concluded that the developments in recent years concerning prices (relating to the cost of the lack of traffic safety and to investments), traffic amount, and traffic risks are not so large that the earlier calculations now would lead to other conclusions. The fact that the social cost-effective investments are not made spontaneously, points to economical market failures. A broad economic analysis gives the following potential causes of this: (1) external effects, like lack of traffic safety, are not incorporated into the price; (2) traffic safety is a 'public good' with connected free ride behaviour; (3) incomplete information with several concerned parties; and (4) transaction and perception costs. Finally, some possible directions for solutions are given. This particularly concerns obtaining and dissemination of knowledge, the use of levies or taxes to internalise the external costs and to induce safe behaviour, and the introduction of conditional grants to road authorities to achieve investments directed at traffic safety. (A) See also IRRD 848338 (C 282), 882425 (C 5792), and 887715 (C 7112)
Abstract