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The role of cost-benefit analyses

The role of cost-benefit analyses


The role of cost-benefit analyses

To overcome resistance to change, which will also be caused by questions of cost, objective data and facts are needed that show economic savings generated by these measures to be higher than their costs.

Table 3 shows the socio-economic costs of young driver fatalities in OECD countries. The costs include medical costs, production loss, settlement costs and loss of quality of life (also referred to as 'human costs' or 'human losses'). For most European countries a standard European value is used (corrected for differences in purchasing power), as proposed by the ECMT. In addition, country specific values have been used for non-European countries. The calculations indicate that the total costs of young driver fatalities in the countries mentioned are about 20 billion euros (price level 2004). A large part of these costs, about 14 billion euros, are human losses. The other costs (medical costs, gross production loss and settlement costs) are about 6 billion euros. Note that victims of young driver crashes killed along with the young drivers are not incorporated into the calculations in Table 3, nor are the costs of injuries. Thus, obviously, the full costs of young drivers' crashes will be much higher [27].

 Number of young driver fatalitiesCost per fatality including human losses (million euros, 2004)Total costs including human losses (million euros, 2004)Total costs excluding human losses (million euros, 2004)
Australia (1)1951.16227179
Canada (1)2621.37360-
NZ (1)511.66850
USA (1)3 9993 5814 3333 715
Iceland (2)32.1962
Austria (3)1101.7819672
Belgium (3)1541.83281104
Denmark (3)351.866524
Finland (3)431.707327
France (3)6451.801 159429
Germany (3)7501.821 362504
Greece (3)1051.6517364
UK (3)3301.85611226
Ireland (3)311.936022
Netherlands (3)741.9614554
Norway (3)252.045119
Portugal (3)801.7213751
Spain (3)3221.83591219
Sweden (3)401.777126
Switzerland (3)491.859033
Total  20 0655 903

Source: SWOV,

(1) Source of calculations: Sælensminde (2003)

(2) Source of calculations: Calculations by SWOV

(3) Source of calculations: ECMT (1998)

Table 3: the costs associated with traffic fatalities per country

These calculations can be used to carry out cost-benefit analyses, in which the costs of measures are compared to the savings that will result from the measures. As yet, in the field of young novice drivers no such cost-benefit analyses have been carried out.