Friday, October 31, 2008

the economics of speeding tickets

Here's an interesting NYT article by Yale Professor of Economics, Judith Chevalier (hat tip: Linda Christiansen?)...

My car had picked up speed coming down a hill, and a police officer pulled me over. As I waited for a ticket, I wondered: Does this town supplement its finances by giving tickets to visitors like me?

I never got to the bottom of the situation in that particular town, but the broader question — whether police officers in some towns are motivated by fund-raising as well as safety when writing traffic tickets — has been examined systematically by others. Michael D. Makowsky, a doctoral student in economics, and Thomas Stratmann, an economics professor, both at George Mason University, studied the issue in a recent paper, “Political Economy at Any Speed: What Determines Traffic Citations?”

They examined every warning and citation written by police officers in all of Massachusetts, excluding Boston, during a two-month period in 2001 — over 60,000 in all. Their conclusion wasn’t shocking to an economist: money matters, even in traffic violations. They found a statistical link between a town’s finances and the likelihood that its police officers would issue a speeding ticket. The details are a little sticky, but they show that tickets were issued more often in places that were short on cash, and that out-of-towners received tickets more often than drivers with local addresses.

First, some background: In Massachusetts, a police officer is given the discretion to decide whether to issue a warning, which carries no fine, or a citation, which does. The fines for the tickets issued in that period by local police officers totaled $1.8 million, with state troopers issuing $1.7 million more in tickets. The study focused on the local police.

Municipal finance in Massachusetts is affected by Proposition 2.5, which in 1980 placed a cap on overall property tax levies and on their rate of growth. It turns out that traffic tickets are affected by the proposition, too — or at least that’s what the study found....

Mr. Makowsky and Mr. Stratmann also showed that out-of-town drivers — especially out-of-state drivers — were much more likely to get citations. A driver from out of town had a 10 percent higher probability of getting a ticket than a local driver, holding speed and other characteristics constant. Out-of-state plates added 10 percent to the probability of getting a ticket....

He and his co-author speculated that the seeming discrimination against out-of-towners by the local police might be explained by two factors: a desire to avoid antagonizing local voters and a preference for ticketing people who were less likely to travel to court to protest a ticket....

With housing prices now flat or down, town governments may try to seek property tax rate increases, and voters may resist. Historically, economists have noticed that when there is a lid on property taxes, towns turn to user fees and other sources of revenue — like speeding tickets — to avoid spending cuts....

Mr. Makowsky and Mr. Stratmann did find that ticketing was modestly lower in towns with high levels of employment in the hospitality industry, suggesting that police departments might consider the effects of aggressive ticketing on local commerce....


There is further discussion of this article at MarginalRevolution.com...

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