More Tickets, Fewer Accidents: How Cash-Strapped Towns Make for Safer Roads

Traffic accidents are one of the leading causes of injury and death in the U.S. The role of traffic law enforcement in the reduction of accidents has been studied by relatively few papers and with mixed results that may be due to a simultaneity problem. Traffic law enforcement may reduce accidents, but police are also likely to be stricter in accident-prone areas. We use municipal budgetary shortfalls as an instrumental variable to identify the effect of traffic citations on traffic safety and show that budgetary shortfalls lead to more frequent issuance of tickets to drivers. Using a panel of municipalities in Massachusetts, we show that increases in the number of tickets written reduce motor vehicle accidents and accident related injuries. The findings show that failure to control for endogeneity results in a significant underestimation of the positive impact of law enforcement on traffic safety. Acknowledgements: We thank Richard Conard and the Massachusetts Highway Department for data and related assistance, Finn Christenson, Alex Tabarrok and seminar participants at the University of Hamburg and Towson University for helpful comments and suggestions.