This paper evaluates the desirability of the new national speed limit using tools of normative and positive economic analysis. The theoretical case for a speed limit is analyzed, and it is concluded that externalities in driving may justify the use of a speed limit, among other policies. The principal costs and benefits of the present speed limit are then discussed, and available data are used in order to suggest the reasonable orders of magnitude of costs and benefits. A number of conceptual and empirical limitations of the analysis are emphasized. Finally, several alternatives to the national speed limit are noted.
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