The Economics of Railroad Safety

The American public has a fascination with railroad wrecks that goes back a long way. One hundred years ago, staged railroad accidents were popular events. At the Iowa State fair in 1896, 89,000 people paid $20 each, at current prices, to see two trains, throttles wide open, collide with each other. "Head-on Joe" Connolly made a business out of "cornfield meets" holding seventy-three events in thirty-six years. Picture books of train wrecks do good business presumably because a train wreck can guarantee a spectacular destruction of property without the messy loss of life associated with aircraft accidents. A "train wreck" has also entered the popular vocabulary in a most unusual way. When political manoeuvering leads to failure to pass the federal budget, and a shutdown is likely of government services, this is widely called a "train wreck. " In business and team sports, bumbling and lack of coordination leading to a spectacular and public failure to perform is also called "causing a train wreck. " A person or organization who is disorganized may be labelled a "train wreck. " It is therefore not surprising that the public perception of the safety of railroads centers on images of twisted metal and burning tank cars, and a general feeling that these events occur quite often. After a series of railroad accidents, such as occurred in the winter of 1996 or the summer of 1997, there are inevitable calls that government "should do something.

Zusammenfassung
Picture books of train wrecks do good business presumably because a train wreck can guarantee a spectacular destruction of property without the messy loss of life associated with aircraft accidents.

Inhalt
1 Setting the Scene.- 2 Historical Trends.- 3 Public Policy.- 4 How Safe are American Railroads?.- 5 Risk Evaluation.- 6 The Story So Far.- 7 Economic Theory of Bilateral Accidents.- 8 Highway Grade Crossings.- 9 Trespassers.- 10 Occupational Injuries.- 11 Benchmark Levels of Operational Safety.- 12 Market Power.- 13 Imperfect Information.- 14 Customer Rationality.- 15 Railroad Myopia 115.- 16 Externalities.- 17 Non-Regulatory Responses.- 18 Federal Safety Regulations.- 19 Evaluation of Regulations.- 20 A New Era for Safety Regulation.- 21 The Way Forward.- References.