Shaping the Habits of Teen Drivers

Abstract

Teens are risky drivers and often subject to extra restrictions. We examine the effects of an Australian intervention banning first-year drivers from carrying multiple passengers between 11:00pm and 4:59am, which had represented 3% of their accidents and 18% of their fatalities. Using daytime outcomes to account for counterfactual crash risks, we find the reform more than halves targeted crashes, casualties and deaths. The restriction also lowers crashes earlier in the evening and beyond the first year, suggesting it has broad and persistent effects on driving behavior. Overall, this targeted intervention delivers gains comparable to harsher restrictions that delay teen driving. Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.