The UK Department of Transport has recently made a major revision to the way in which it values safety, which has resulted in a very substantial increase in the monetary value assigned to the avoidance of road fatalities, while applying cost-benefit analyses. In view of this development and because of the recent spate of transport disasters, this paper reviews some of the more significant issues related to the valuation of transport safety for all transport modes. It examines the more important procedures, that have been proposed for placing values on transport safety, and argues in favour of the 'willingness to pay' approach, where travellers would agree to pay more for the increased safety of their journeys. It summarises the results of empirical work, aimed at obtaining estimates of willingness to pay based on the values of road safety, and compares them with estimates for other contexts. It examines the allocative implications of adopting these values in road project appraisal in the UK. It considers how far road risks can be viewed as externalities, imposed by drivers on society in general and other drivers in particular, and assesses how far they have already been internalised. It discusses asymmetries in the treatment of safety in different transport modes, and examines the implications of these asymmetries for the provision of safety. It proposes a six-point agenda for future research in the economics of transport safety.
Abstract