Sunday, January 25, 2015

More moral hazards in action

A moral hazard is when isolating people from a risk encourages more risky behavior. The San Francisco Chronicle is reporting an uptick in speeds and minor accidents on the Golden Gate Bridge following the installation of a safety barrier in the median.

The California Highway Patrol announced Thursday that it is stepping up enforcement of speed limits on the Waldo Grade in Marin as well as at the bridge and toll plaza. The reason is that in the days since the more secure movable median barrier was installed, the average speed of drivers on the approach from the north has jumped even though the speed limit was lowered from 55 to 45 miles per hour.

To clarify, that doesn't mean that risks always magically balance out, but changes in human behavior need to be considered when considering new safety precautions.

Hat tip to Alex Tabarrok.

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