“Rubbin’ is racin''': evidence of the Peltzman effect from NASCAR
First Online: 27 October 2009 Received: 29 September 2009 Accepted: 14 October 2009 DOI:
10.1007/s11127-009-9548-2 Cite this article as: Pope, A.T. & Tollison, R.D. Public Choice (2010) 142: 507. doi:10.1007/s11127-009-9548-2 Abstract
The Peltzman Effect is a well known and controversial theory in the literature. Studies have struggled to find a dataset that can accurately test for the presence of the effect. We have created a unique dataset and use a natural experiment from the sport of stock car racing to test the theory. Using race-level data from NASCAR events, we find strong evidence that a major safety regulation has led to more on-track accidents and an increased risk to both spectators and pit crew members.
Keywords Nascar Peltzman effect Moral hazard Caution laps
The views expressed herein are those of the author and do not necessarily reflect the views of the Federal Reserve Bank of Kansas City or the Federal Reserve System.
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