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Project Type
UTRC Faculty Development Mini-grants
Project Dates
09/01/2012 - 08/31/2014
Principal Investigators
Project Status

The United States is facing severe infrastructure financing problems. Revenues from fossil-fuel based taxes are declining as vehicles become more fuel efficient and as annual vehicle miles traveled declines. Many states and localities are increasing the role of private investors through public-private partnerships, and 31 states have now passed PPP enabling legislation. These concerns are particularly salient in the Northeastern part of the United States. Meanwhile, traffic safety, although improving, remains a critical concern in all regions. In this study, we combine these two areas of inquiry by examining the effects of private participation on traffic safety. We use a novel data set from Mexico, which has extensive PPP experience. The data set includes approximately 800 Mexican municipalities from 1997 to 2010, resulting in a panel of about 11,000 observations. We can identify government versus PPP control over the kilometers of road within a municipality. The data allow us to control for a variety of independent variables. We are able to include such variables as the class of accident, the condition of the driver, and the condition of the road surface, among others. We have 15 control variables overall. The expected effect of PPPs on road safety is ambiguous. PPPs may increase road safety if more resources are available for resurfacing, and if PPPs are incentivized through contracts to enhance safety. However, PPPs may reduce safety if private operators reduce road quality to increase profit maximize profits. The issue must be resolved empirically. Regarding methods, we will begin our study with relatively simple statistical techniques such as ordinary least squares regression to estimate the determinants of traffic accidents and fatality rates. We will include an indicator (dummy) variable for the type of operation: traditional or PPP. We will include both time- and municipal-fixed effects, and will use robust standard errors. We expect that this study will make a significant contribution to the literature on PPPs. This will be the first study to date to examine explicitly the effect of PPPs on traffic safety.