Paging Inspector Sands: The Costs of Public Information

Original Article By: Sacha Kapoor and Arvind Magesan
American Economic Journal: Economic Policy 2014, 6(1): 92-113
Major Topic: Governance
Minor Topic: Politics

Précis:

         Inspector sands is the code world used by some theater companies in the UK to inform staff of an emergency while keeping patrons from panicking. The choice between “paging inspector sands” or yelling “fire” in a theater represents “the extremes of what policymakers can do when they have private information about the state of the world. The dilemma for the policymaker is in determining when one policy is more sensible than the other.” The short answer “... hinges on identifying the potential for negative externalities to outweigh individual gains form having better information....When the individual gains are expected to outweigh the negative externalities, full disclosure is the smart policy. When negative externalities are expected to dominate, withholding information is a better idea.”

         This paper studies the effects of providing more public information in the form of pedestrian countdown signals (which also alert drivers to the time remaining on a green light) on the behaviour and safety of all road users.

         The data for this study came from Toronto. Between November 2006 and December 2008 the City of Toronto installed more energy-efficient LED lamps which for the first time included pedestrian count-down signals. The authors compared the number and type of accident at all the intersection each month over the five year period beginning January 2004 and ending December 2008.

         The results of installing pedestrian count-down signals are: 1) for car on car accidents, there were 0.012 more accidents per month (a 5.2% increase over the 0.229 average accident per intersection per month pre-count-down signal installation) at an average intersection. 2) Looking only at vehicle on pedestrian accidents: there were fewer pedestrians hit by vehicles to the tune of 0.0032 or 1.4% fewer pedestrians hit by cars; and 3) there was a statistically insignificant drop in car on cyclist accidents. The authors found that “...collisions rose largely because of an increase in tailgating among drivers, a finding that implies drivers who know exactly when traffic lights will change behave more aggressively.”

         The authors consider whether the count-down signal distracts the driver but find the data does not support that because accidents increase over time but the effects of distractions tend to affect people initially and wear off over time.

         The welfare gains to pedestrians (fewer injury and surprisingly more pedestrian traffic) comes at the detriment of vehicle drivers. Overall and in total pedestrian count-down signals make most intersections less safe. Only the historically most dangerous intersection became slightly safer.

         Since pedestrian count-down signals lower pedestrian accidents and increase vehicular accidents, policy makers can “... improve overall welfare by sharing the information with pedestrians and hiding it from drivers.”

        

Added on: 2014-02-17 18:57:14