Abstract:

This paper discusses how regulations can determine environmental and safety outcomes in transport systems. It explores the relationships between regulations and direct and indirect costs, and between regulations and benefits. It also discusses the ethical issues, such as the fact that cost-benefit analysis evaluates welfare effects but tends to ignore equity issues. The most important conclusions from this paper are: (1) Regulations can have an impact on determinants for the environmental and safety impacts of the transport system in several ways. These determinants include volume, modal split, technology, and the way vehicles are used. (2) A Cost Benefit Analysis  is a potentially useful instrument for an ex-ante evaluation of the effects of regulations in the area of road safety and the environment. (3) Estimating direct costs of regulations can be difficult, and especially estimating changes in unit costs over time can be problematic. Changing preferences for the environment and safety can also be very relevant. (4) Regulations can have indirect effects, and these can both be very important in policy debates, as well as be substantial from a welfare perspective. (5) Ethical considerations are not included in CBA, but can be relevant for policy making and the wider public.