Grantham Workshop | Lucija Muehlenbachs 'External Cost of Trucking: Evidence from Shale Gas and Traffic Accidents'

Lucija Muehlenbachs, an Assistant Professor at the University of Calgary and a Visiting Fellow at the Grantham Research Institute, LSE, will be the speaker for this seminar. The title of her talk will be ‘External Cost of Trucking: Evidence from Shale Gas and Traffic Accidents’. A full abstract is below:

Abstract: How much risk does a heavy truck impose on highway safety, and is this risk covered by current liability regimes in the U.S.?  To answer these questions, we exploit the rapid influx of heavy trucks during the shale gas boom in Pennsylvania.  Using quasi-experimental variation in truck traffic flows we isolate the impact of trucks from boomtown effects. We compare the implied damages from a truck accident to the minimum liability coverage that is currently required for trucking.  Although debated by policymakers, these limits have remained the same for the last 30 years.  Furthermore, an increase in traffic safety might have costs beyond those directly involved—car insurance premiums may increase for everyone living in the vicinity.  Indeed this appears to be the case for zip codes with heavy shale gas drilling.  Examining car insurance premiums offered to the same representative individual across different zip codes and years, we find that the insurance rate for a new enrollee is higher in zip codes after drilling.

This seminar is open to all LSE staff and students. If you are from outside the LSE and would like to attend, please email Gri.Events@lse.ac.uk to register for a place.