The environmental cost and the accident externality of driving: Evidence from the Swiss franc's appreciation

Abstract

This study investigates the effects of driving on air quality and road safety by exploiting exogenous variation in traffic flows associated with the Swiss franc's appreciation. During the Swiss franc's appreciation, the volume of cars crossing the Swiss-Italian border rose considerably-the higher purchasing power of Swiss francs in the Euro area induced more Italian workers to cross the border daily to work in Switzerland and increased the propensity for Swiss consumers to shop abroad (Bello, 2019). By using hourly data on traffic flows, road accidents, and air pollution, I show that the higher mobility across the border increased the concentration of oxides of nitrogen at peak hours during working days and the risk of road traffic accidents with (mild) personal injuries at late morning on non-working days. The elasticity to the the number of cars of both variables of interest turns out to be larger than 1, providing evidence of a harmful externality. This suggests the need for programmes that treat traffic congestion, air quality, and road safety jointly. Moreover, the existence of an externality has important implications for optimal road use pricing.

Study of the Technogenic Impact of Motor Transport on the Environment in Cities

“…Hot and cold weather increases energy consumption in buildings and vehicles due to the widespread use of air conditioners, which leads to increased emissions. Hot weather also contributes to higher O3 generation through photochemical reactions [20]. Weather conditions include various meteorological parameters such as wind speed and direction, temperature, humidity, and sunlight.…”