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A Probabilistic Analysis of the Passive–Restraint Question

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  • John D. Graham
  • Max Henrion

Abstract

The benefits and costs of automobile safety policies are compared using a methodology which explicitly quantifies the uncertainties. The policies addressed include both voluntary and compulsory manual belt usage, nondetachable passive (automatic) seat belts, and air bags. Estimates of the effectiveness and usage rates of these alternatives were obtained in the form of subjective probability distributions from eight experts. Their opinions were combined using equal weighting. The direct economic costs of the technologies were also estimated probabilistically. The number of lives saved and the net benefits of the policies were calculated probabilistically for a range of values of lifesaving. Probabilistic computations and sensitivity analysis were performed by the Demos modelling system using Monte Carlo simulation. The results are highly uncertain and quite sensitive to the value of lifesaving. Nevertheless, they imply that repeal of the passive‐restraint standard is defensible according to the net‐benefit criterion only if a relatively low value is assigned to lifesaving. The degree of uncertainty emphasizes the potential value of demonstration programs to obtain better information.

Suggested Citation

  • John D. Graham & Max Henrion, 1984. "A Probabilistic Analysis of the Passive–Restraint Question," Risk Analysis, John Wiley & Sons, vol. 4(1), pages 25-40, March.
    • Handle: RePEc:wly:riskan:v:4:y:1984:i:1:p:25-40
    DOI: 10.1111/j.1539-6924.1984.tb00129.x
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    References listed on IDEAS

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    1. John D. Graham & Steven Garber, 1984. "Evaluating the effects of automobile safety regulation," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 3(2), pages 206-224.
    2. Lindgren, Bjorn & Stuart, Charles, 1980. "The Effects of Traffic Safety Regulation in Sweden," Journal of Political Economy, University of Chicago Press, vol. 88(2), pages 412-427, April.
    3. Peltzman, Sam, 1975. "The Effects of Automobile Safety Regulation," Journal of Political Economy, University of Chicago Press, vol. 83(4), pages 677-725, August.
    4. Blomquist, Glenn, 1981. "The Value of Human Life: An Empirical Perspective," Economic Inquiry, Western Economic Association International, vol. 19(1), pages 157-164, January.
    5. Landefeld, J.S. & Seskin, E.P., 1982. "The economic value of life: linking theory to practice," American Journal of Public Health, American Public Health Association, vol. 72(6), pages 555-566.
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    Cited by:

    1. Kimberly M. Thompson & Maria Segui‐Gomez & John D. Graham, 2002. "Validating Benefit and Cost Estimates: The Case of Airbag Regulation," Risk Analysis, John Wiley & Sons, vol. 22(4), pages 803-811, August.
    2. Magnus Johannesson, 1993. "The contingent valuation method—appraising the appraisers," Health Economics, John Wiley & Sons, Ltd., vol. 2(4), pages 357-359, December.

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