Wiggins Charlie ORF 467 HMWK #1 27 September 2004 1. In April of 2003, Professor Orley Ashenfelter, of Princeton University, and Professor Michael Greenstone, of the University of Chicago, published their joint effort work "Using Mandated Speed Limits to Measure the Value of a Statistical Life." Their conclusions were summarized in the Princeton Packet: "Studying the years from 1987 to 1993, the economists found that on average people drove about 2 mph faster on roads with a 65-mph limit than they did under the old 55-mph limit." From this and other data, A&G then created a formula to find the value of a life, based on the value of time saved in travel. They came to the conclusion that the value of a statistical life (vsl) is approximately $1.54 M, although they later state their "estimates of the value of a statistical life fall[s] in the range between $1 million and $10 million." Basically, this value was calculated on the assumption that the two factors involved in speed limit regulations are the benefits (reduced travel time) and the costs (fatality risk). With these ideas in mind, A&G formulated that average speeds only increased by about 3.5%, or 2 mph, although the fatality rates increased by roughly 35%. Furthermore, only 45 million hours were saved by the speed increase, where an additional 360 fatalities occurred, or only 125,000 hours per life. A&G then decided that an hourly wage should be used as the multiplying constant to decide the monetary value of these hours saved, with hourly wage about $12 (i.e. $12 X 125,000 $1.54 M). To publish this report A&G needed to collect three main areas of data: vehicle miles traveled, fatal accidents, and vehicle speeds. They collected this data from many sources. They found much of their vehicle miles traveled from the Federal Highway Administration's Highway Statistics, which is very readily available and reliable. They collected much of their fatal accident data from the Fatal Accident Reporting System, which is a census maintained by the National Highway Traffic Safety Administration reporting all accidents including the death of one or more persons. Where finding data on vehicle miles traveled and fatal accidents is fairly straightforward and easy, A&G ran into some problems in collecting vehicle speed data. The problem resulted from the Federal Highway Administration only requiring the monitoring of travel speeds on roads posting a 55 mph speed limit. Since the roads they wanted were now 65 mph, many states did not keep the records. In fact, only 21 of the 41 states that increased the limit to 65 mph actually provided A&G with the wire loop travel speed data they needed. 2. A&G did a tremendous job in their estimation of vsl; however, there are two areas that their data is insufficient. First off, they searched for data on vehicle speed. This seems like a reasonable thing to do, but vehicle speed is continuously varying. It is very uncommon for someone to travel at a constant speed throughout a trip. Therefore,
instead of vehicle speed, they should use total travel time. This truly will then show how much time someone saves with the 65-mph speed limit. Sources for finding this information would undoubtedly come from using gps technology. I would recommend they approach the infamous Professor Kornhauser of Princeton University about uncovering this much needed. The second area that A&G should rethink is the use of hourly wage as the multiplying constant for the value of one hr of driving. I feel that this is insufficient data for many reasons. First off, I would like to see the breakdown of those that earning an hourly wage and their driving habits, as opposed to those that do not earn an hourly wage (instead they have a salary) and their driving habits. I feel that those on salary customarily drive greater distances at higher speeds. Furthermore, I would want to debate the claim that hourly wage should be any determinant of what an hour of driving is worth. By using this barometer, one would be erroneously claiming that the value of a person's life is based on yearly salary, not on other intangibles.
Main Source Survey Data Provided Area Used *** About 3.3 million Americans travel 50 miles or more one way to get to work - and they commute these distances 329 million times a year; *** For deciding a better "Stretch commuters" are mostly multiplying constant male. Women - 52 percent of for value of one hr the population - only make 16 driving; instead of percent of "stretch commuting" using hourly wage. trips; ***Nearly three out of five "stretch commuting" trips are made by someone from a household with an annual income of at least $50,000. *** Nine out of 10 long-distance trips are by personal vehicle; To show trip time, not ***Personal vehicles are used trip speed. for almost all trips less than 300 roundtrip miles. Links may be Provides many links to road navigated to help closures and traffic conditions. estimate total trip time. Contains many interesting charts and data. For instance, Anything. Abundant the distribution of transportation source of data. fatalities in 2000. Can be used to help Provides demographical decipher amount of breakdown of American Americans citizens (e.g. 2001 total civilian commuting to work, labor force in thousands is and geographic 141,815) commute.
Bureau of Transportation Statistics (BTS)
National Household Travel Survey (NHTS)
Bureau of Transportation Statistics (BTS) U.S. Department of National Traffic Tranpsortation: and Road Closure Federal Highway Information Administration Bureau of Transportation Statistics (BTS) Pocket Guide to Transportation
Bureau of Transportation Statistics (BTS)
Table A: Social and Economic Characteristics of the United States
Links Used: www.bts.gov/press_releases/2004/bts010_04/html/bts010_04.html http://www.bts.gov/publications/national_household_travel_survey/quick_sheets/l ong_distance.html http://www.fhwa.dot.gov/trafficinfo/index.htm#TRFF http://www.princeton.edu/~alaink/Orf467F04/PocketGuideTransp2003.pdf http://www.bts.gov/publications/national_transportation_statistics/2003/html/table _a.html 3. After looking through T21, I came across a couple of projects involving roads by my home (Howell, NJ). One that I found was the Transit Ferry Boat Program (http://www.fhwa.dot.gov/tea21/factsheets/ferry.htm), where NJ got $5 M each year for from 1999 through 2003. This money was used...