Abstract
The Peltzman effect posits that implementing safety measures incentivizes agents to reduce their effort to a degree where these measures become counterproductive. This paper emphasizes the significance of including the agent’s type (skills, attributes) when analyzing the effectiveness of safety measures. Using data from iRacing, an online racing simulator, we find that the detection of the Peltzman effect is solely attributed to the omitted variable bias; specifically, the omission of a variable capturing the agent’s type. Additionally, our data demonstrates that enhancing types (increasing skills) leads to safety improvements.
References
Abbott, J. K., and H. A. Klaiber. 2011. “An Embarrassment of Riches: Confronting Omitted Variable Bias and Multi-Scale Capitalization in Hedonic Price Models.” The Review of Economics and Statistics 93: 1331–42. https://doi.org/10.1162/rest_a_00134.Suche in Google Scholar
Acs, Z. J., and L. Szerb. 2007. “Entrepreneurship, Economic Growth and Public Policy.” Small Business Economics 28: 109–22. https://doi.org/10.1007/s11187-006-9012-3.Suche in Google Scholar
Al-Shammari, H., and C. Ling. 2019. “Investigating the Effectiveness of a Traffic Enforcement Camera-System on the Road Safety in Saudi Arabia.” In Advances in Human Aspects of Transportation, Advances in Intelligent Systems and Computing, Vol. 786, edited by N. Stanton. Switzerland: Springer.10.1007/978-3-319-93885-1_60Suche in Google Scholar
Alghnam, S., J. Towhari, M. Alkelya, A. Binahmad, and T. M. Bell. 2018. “The Effectiveness of Introducing Detection Cameras on Compliance with Mobile Phone and Seatbelt Laws: A Before-After Study Among Drivers in Riyadh, Saudi Arabia.” Injury Epidemiology 5: 31. https://doi.org/10.1186/s40621-018-0161-z.Suche in Google Scholar
Altonji, J. G., T. E. Elder, and C. R. Taber. 2005. “Selection on Observed and Unobserved Variables: Assessing the Effectiveness of Catholic Schools.” Journal of Political Economy 113: 151–84. https://doi.org/10.1086/426036.Suche in Google Scholar
Andrews, I., J. H. Stock, and L. Sun. 2019. “Weak Instruments in Instrumental Variables Regression: Theory and Practice.” Annual Review of Economics 11: 727–53. https://doi.org/10.1146/annurev-economics-080218-025643.Suche in Google Scholar
Angrist, J. D., and A. B. Krueger. 2001. “Instrumental Variables and the Search for Identification: From Supply and Demand to Natural Experiments.” The Journal of Economic Perspectives 15: 69–85. https://doi.org/10.1257/jep.15.4.69.Suche in Google Scholar
Angrist, J. D., and J.-S. Pischke. 2009. Mostly Harmless Econometrics: An Empiricist’s Companion. Switzerland: Princeton University Press.10.1515/9781400829828Suche in Google Scholar
Arnold, D., W. Dobbie, and P. Hull. 2022. “Measuring Racial Discrimination in Bail Decisions.” The American Economic Review 112: 2992–3038. https://doi.org/10.1257/aer.20201653.Suche in Google Scholar
Audretsch, D. B., I. Grilo, and A. R. Thurik, eds. 2007. Handbook of Research on Entrepreneurship Policy. Switzerland: Edward Elgar Publishing.10.4337/9781847206794Suche in Google Scholar
Baumol, W. J. 1990. “Entrepreneurship: Productive, Unproductive, and Destructive.” Journal of Political Economy 98: 893–921. https://doi.org/10.1016/0883-9026(94)00014-x.Suche in Google Scholar
Blanchflower, D. G., and A. J. Oswald. 1998. “What Makes an Entrepreneur?” Journal of Labor Economics 16 (1): 26–60, https://doi.org/10.1086/209881.Suche in Google Scholar
Busenbark, J. R., H. Yoon, D. L. Gamache, and M. C. Withers. 2022. “Omitted Variable Bias: Examining Management Research with the Impact Threshold of a Confounding Variable (ITCV).” Journal of Management 48: 17–48. https://doi.org/10.1177/01492063211006458.Suche in Google Scholar
Cardella, G. M., B. R. Hernández-Sánchez, and J. C. Sánchez García. 2020. “Entrepreneurship and Family Role: A Systematic Review of a Growing Research.” Frontiers in Psychology 10: 2939. https://doi.org/10.3389/fpsyg.2019.02939.Suche in Google Scholar
Certo, S. T., J. R. Busenbark, H. Woo, and M. Semadeni. 2016. “Sample Selection Bias and Heckman Models in Strategic Management Research.” Strategic Management Journal 37: 2639–57. https://doi.org/10.1002/smj.2475.Suche in Google Scholar
Chaudhuri, S., and D. K. Guilkey. 2016. “GMM with Multiple Missing Variables.” Journal of Applied Econometrics 31: 678–706. https://doi.org/10.1002/jae.2444.Suche in Google Scholar
Cinelli, C., and C. Hazlett. 2020. “Making Sense of Sensitivity: Extending Omitted Variable Bias.” Journal of the Royal Statistical Society – Series B: Statistical Methodology 92: 39–67. https://doi.org/10.1111/rssb.12348.Suche in Google Scholar
Cohen, A., and L. Einav. 2003. “The Effects of Mandatory Seat Belt Laws on Driving Behavior and Traffic Fatalities.” The Review of Economics and Statistics 85: 828–43. https://doi.org/10.1162/003465303772815754.Suche in Google Scholar
Cordellieri, P., F. Baralla, F. Ferlazzo, R. Sgalla, L. Piccardi, and A. M. Giannini. 2016. “Gender Effects in Young Road Users on Road Safety Attitudes, Behaviors and Risk Perception.” Frontiers in Psychology 7: 1412, https://doi.org/10.3389/fpsyg.2016.01412.Suche in Google Scholar
Da Silveira, B. S., and J. M. P. De Mello. 2011. “Campaign Advertising and Election Outcomes: Quasi-Natural Experiment Evidence from Gubernatorial Elections in Brazil.” The Review of Economic Studies 78: 590–612. https://doi.org/10.1093/restud/rdq012.Suche in Google Scholar
Diegert, P., M. A. Masten, and A. Poirie. 2023. “Assessing Omitted Variable Bias when the Controls are Endogenous.” arXiv:2206.02303.Suche in Google Scholar
Doleac, J. L., and A. Mukherjee. 2022. “The Effects of Naloxone Access Laws on Opioid Abuse, Mortality, and Crime.” The Journal of Law and Economics 65: 211–38. https://doi.org/10.1086/719588.Suche in Google Scholar
Finkelstein, A., M. Gentzkow, and H. Williams. 2021. “Place-Based Drivers of Mortality: Evidence from Migration.” The American Economic Review 111: 2697–735. https://doi.org/10.1257/aer.20190825.Suche in Google Scholar
Gennaioli, N., R. La Porta, F. L. de Silanes, and A. Shleifer. 2013. “Human Capital and Regional Development.” Quarterly Journal of Economics 128: 105–64. https://doi.org/10.1093/qje/qjs050.Suche in Google Scholar
Greene, W. H. 2017. Econometric Analysis, 8th ed. New York: Pearson.Suche in Google Scholar
Huang, G., and K. Sudhir. 2020. “The Causal Effect of Service Satisfaction on Customer Loyalty.” Management Science 67: 317–41. https://doi.org/10.1287/mnsc.2019.3549.Suche in Google Scholar
Humayun, M., N. Z. Jhanjhi, and A. Almotilag. 2022. “Real-Time Security Health and Privacy Monitoring for Saudi Highways Using Cutting-Edge Technologies.” Applied Sciences 12: 2177. https://doi.org/10.3390/app12042177.Suche in Google Scholar
Knight, F. 1921. Risk, Uncertainty, and Profit. Switzerland: Houghton Mifflin Company.Suche in Google Scholar
Lee, J. M., and L. O. Taylor. 2019. “Randomized Safety Inspections and Risk Exposure on the Job: Quasi-Experimental Estimates of the Value of a Statistical Life.” American Economic Journal: Applied Economics 11: 350–74. https://doi.org/10.1257/pol.20150024.Suche in Google Scholar
Lee, D. S., J. McCrary, M. J. Moreira, and J. Porter. 2022. “Valid T-Ratio Inference for IV.” The American Economic Review 112: 3260–90. https://doi.org/10.1257/aer.20211063.Suche in Google Scholar
Levine, R., and Y. Rubinstein. 2017. “Smart and Illicit: Who Becomes an Entrepreneur and do they Earn More?” Quarterly Journal of Economics 132: 963–1018. https://doi.org/10.1093/qje/qjw044.Suche in Google Scholar
Levitt, S. D., and J. Porter. 2006. “Sample Selection in the Estimation of Air Bag and Seat Belt Effectiveness.” The Review of Economics and Statistics 83: 603–15. https://doi.org/10.1162/003465301753237696.Suche in Google Scholar
Lucas, R. E. 1978. “On the Size Distribution of Business Firms.” The Bell Journal of Economics 9: 508–23. https://doi.org/10.2307/3003596.Suche in Google Scholar
McCallum, B. 1972. “Relative Asymptotic Bias from Errors of Omission and Measurement.” Econometrica 40: 757–8. https://doi.org/10.2307/1912970.Suche in Google Scholar
Murphy, K. M., A. Shleifer, and R. W. Vishny. 1991. “The Allocation of Talent: Implications for Growth.” Quarterly Journal of Economics 106: 503–30. https://doi.org/10.2307/2937945.Suche in Google Scholar
Mustard, D. B. 2003. “Reexamining Criminal Behavior: The Importance of Omitted Variable Bias.” The Review of Economics and Statistics 85: 205–11. https://doi.org/10.1162/rest.2003.85.1.205.Suche in Google Scholar
Oltedal, S., and T. Rundmo. 2006. “The Effects of Personality and Gender on Risky Driving Behaviour and Accident Involvement.” Safety Science 44: 621–8. https://doi.org/10.1016/j.ssci.2005.12.003.Suche in Google Scholar
Oster, E. 2019. “Unobservable Selection and Coefficient Stability: Theory and Evidence.” Journal of Business & Economic Statistics 37: 187–204. https://doi.org/10.1080/07350015.2016.1227711.Suche in Google Scholar
Packham, A. 2022. “Syringe Exchange Programs and Harm Reduction: New Evidence in the Wake of the Opioid Epidemic.” Journal of Public Economics 215: 104733. https://doi.org/10.1016/j.jpubeco.2022.104733.Suche in Google Scholar
Peltzman, S. 1975. “The Effects of Automobile Safety Regulation.” Journal of Political Economy 83: 677–726. https://doi.org/10.1086/260352.Suche in Google Scholar
Peterson, S., G. Hoffer, and E. Millner. 1995. “Are Drivers of Air-Bag-Equipped Cars More Aggressive? A Test of the Offsetting Behavior Hypothesis.” The Journal of Law and Economics 38: 251–64. https://doi.org/10.1086/467331.Suche in Google Scholar
Pfeifer, G., and M. Stockburger. 2023. “The Morning After: Prescription-Free Access to Emergency Contraceptive Pills.” Journal of Health Economics 91: 102775. https://doi.org/10.1016/j.jhealeco.2023.102775.Suche in Google Scholar
Radaelli, C. M., and C. Wagemann. 2019. “What Did I Leave Out? Omitted Variables in Regression and Qualitative Comparative Analysis.” European Political Science 18: 275–90. https://doi.org/10.1057/s41304-017-0142-7.Suche in Google Scholar
Rivkin, S. G., E. A. Hanushek, and J. F. Kain. 2005. “Teachers, Schools, and Academic Achievement.” Econometrica 73: 417–58. https://doi.org/10.1111/j.1468-0262.2005.00584.x.Suche in Google Scholar
Whissell, R. W., and B. J. Bigelow. 2003. “The Speeding Attitude Scale and the Role of Sensation Seeking in Profiling Young Drivers at Risk.” Risk Analysis 23: 811–20. https://doi.org/10.1111/1539-6924.00358.Suche in Google Scholar
Wickens, M. R. 1972. “A Note on the Use of Proxy Variables.” Econometrica 40: 759–61. https://doi.org/10.2307/1912971.Suche in Google Scholar
Wilms, R., E. Mäthner, L. Winnen, and R. Lanwehr. 2021. “Omitted Variable Bias: A Threat to Estimating Causal Relationships.” Methods in Psychology 5: 100075. https://doi.org/10.1016/j.metip.2021.100075.Suche in Google Scholar
Wright, P. G. 1928. The Tariff on Animal and Vegetable Oils. New York: MacMillan.Suche in Google Scholar
Yagil, D. 1998. “Gender and Age-Related Differences in Attitudes Toward Traffic Laws and Traffic Violations.” Transportation Research Part F: Traffic Psychology and Behaviour 1F: 123–35. https://doi.org/10.1016/s1369-8478(98)00010-2.Suche in Google Scholar
© 2023 Walter de Gruyter GmbH, Berlin/Boston
Artikel in diesem Heft
- Frontmatter
- Articles
- Trial Selection and Estimating Damages Equations
- On the Role of Sales Taxes for Efficient Compensation of Property Loss Under Strict Liability
- Broadband Internet and Crime
- Unraveling the Peltzman Effect: The Significance of Agent’s Type
- Reimagining Antitrust Institutions: A (Modest?) Proposal
- Legal Framework for the Protection of Entrepreneurs’ Rights
Artikel in diesem Heft
- Frontmatter
- Articles
- Trial Selection and Estimating Damages Equations
- On the Role of Sales Taxes for Efficient Compensation of Property Loss Under Strict Liability
- Broadband Internet and Crime
- Unraveling the Peltzman Effect: The Significance of Agent’s Type
- Reimagining Antitrust Institutions: A (Modest?) Proposal
- Legal Framework for the Protection of Entrepreneurs’ Rights