Speed Variance, Enforcement, and the Optimal Speed Limit
Philip E. Graves
University of Colorado at Boulder - Department of Economics
University of Georgia - C. Herman and Mary Virginia Terry College of Business - Department of Economics
Robert L. Sexton
Pepperdine University - Economics Department
Economics Letters, Vol. 42, pp. 237-243, 1993
A model of the optimal speed limit is developed which explicitly recognizes the role of average speed, speed variance, and the level of enforcement. An unusual result emerges, namely that a higher speed limit may be optimal when reducing the variance in highway speeds reduces accident externalities.
Number of Pages in PDF File: 7
Keywords: highway speeds, highway speed variance, public policy, optimal speed limits, statute enforcement
JEL Classification: D02, D04, D03, D11, K10, K14, K42, R41
Date posted: August 3, 2011
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