7 Pages Posted: 3 Aug 2011
Date Written: 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.
Keywords: highway speeds, highway speed variance, public policy, optimal speed limits, statute enforcement
JEL Classification: D02, D04, D03, D11, K10, K14, K42, R41
Suggested Citation: Suggested Citation
Graves, Philip E. and Lee, Dwight and Sexton, Robert L., Speed Variance, Enforcement, and the Optimal Speed Limit (1993). Economics Letters, Vol. 42, pp. 237-243, 1993. Available at SSRN: https://ssrn.com/abstract=1904038