Very interesting. One reason it may not happen in Europe as much is that policy regulations tend to be less car-friendly, with higher taxes on petrol and limitations on car traffic in downtown areas.
Smaller cars could be made more safe, but that would add weight, and they're hamstrung by fuel efficiency regulations. "Safe, small cars" have been effectively regulated out of possibility.
(1) Government regulations that cause reductions in vehicle size also impose an externality. There is substantial empirical evidence that these regulations increase vehicular mortality. Any regulation that forced size reductions would have this effect.
(2) Some (most?) of the size externality is remedied by higher liability insurance rates.
(3) Vehicle size increases risk to others, but likely not as much as (poor) driver skills.
1. The externality is internalized when you impose a cost on it. Im not entirely sure what externality does a car size tax impose.
2. I think the issue here is the 'free rider' problem. Since insurance is pooled, big car owners pay much less than they should. Moreover the damage to the environment and the road wear and tear are not fully internalized.
3. Unlikely that the driving skill distribution has changed over time. Moreover, it is unlikely that 'bad drivers' choose big cars. But even if so, a regulation imposing a new license for larger cars (as truck drivers) would also act as a way of alleviating the issue.
Very interesting. One reason it may not happen in Europe as much is that policy regulations tend to be less car-friendly, with higher taxes on petrol and limitations on car traffic in downtown areas.
I posted that recently about Paris: https://x.com/page_eco/status/1832746075247227125
Smaller cars could be made more safe, but that would add weight, and they're hamstrung by fuel efficiency regulations. "Safe, small cars" have been effectively regulated out of possibility.
Three comments:
(1) Government regulations that cause reductions in vehicle size also impose an externality. There is substantial empirical evidence that these regulations increase vehicular mortality. Any regulation that forced size reductions would have this effect.
(2) Some (most?) of the size externality is remedied by higher liability insurance rates.
(3) Vehicle size increases risk to others, but likely not as much as (poor) driver skills.
1. The externality is internalized when you impose a cost on it. Im not entirely sure what externality does a car size tax impose.
2. I think the issue here is the 'free rider' problem. Since insurance is pooled, big car owners pay much less than they should. Moreover the damage to the environment and the road wear and tear are not fully internalized.
3. Unlikely that the driving skill distribution has changed over time. Moreover, it is unlikely that 'bad drivers' choose big cars. But even if so, a regulation imposing a new license for larger cars (as truck drivers) would also act as a way of alleviating the issue.