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Mid-America Transportation Center

Dollars for Lives: The Effect of Highway Capital Investments on Traffic fatalities

Final Report
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Researchers

  • Principal Investigator: Phuong Nguyen-Hoang (phuong-nguyen@uiowa.edu
  • Project Status
    Complete
    About this Project
    Brief Project Description & Background
    We use advanced panel data methods including instrumental variables to examine the effects of highway capital outlay and maintenance expenditures on highway fatalities. These methods allow us to identify the causal effect of highway capital expenditures on fatalities. Our analyses are based on state-level data from 1965 till 2010 on highway fatalities and finance.
    Research Objective
    An important strategic goal of the U.S. Department of Transportation and the Mid-American Transportation Center is to enhance traffic safety. Understanding determinants of highway fatalities and thus making appropriate policies serve that goal well. This is a timely study given recent increases in highway fatalities and state decreases in highway spending.
    Potential Benefits
    This study has important policy implications given reductions in revenues. Most of the recent federal stimulus dollars ended in 2011 and 2012. According to the Congressional Budget Office’s (2012) estimates, when fully enacted in 2040, new federal fuel-economy standards will reduce gas tax revenues – a major source of states’ highway revenues – by 21 percent. Additionally, states faced with declines in gas tax revenues have already cut back drastically on spending on roads including on maintenance and capital outlay (Reed and Rall 2011). The findings from this study will shed light on how future continued cutbacks on capital outlay and maintenance spending affect traffic safety, and what policies should be taken to enhance safety.
    Abstract
    An important strategic goal of the U.S. Department of Transportation and the Mid-American Transportation Center is to enhance traffic safety. Understanding determinants of highway fatalities andthus making appropriate policies serve that goal well. Potentially significant determinants of highway fatalities that have never been explored in the highway safety literature are expenditures on highway maintenance and capital outlay. Specifically, this state-level study examines the effects of highway capital outlay and maintenance expenditures on highway fatalities using advanced panel data methods between 1965 and 2010. This is a timely study given recent increases in highway fatalities (Eisentein 2012) and state decreases in highway spending (Reed and Rall 2011). The findings from this study will shed light on how future continued cutbacks on capital outlay and maintenance spending affect traffic safety, and what policies should be taken to enhance safety.
    Project Amount
    $ 56,157