Risk compensation is a theory which suggests that people typically adjust their behavior in response to perceived levels of risk, becoming more careful where they sense greater risk and less careful if they feel more protected. This effect is usually small in comparison to the fundamental benefits of safety interventions, but it can reduce the overall benefits or even result in increased risks. "Behavioural adaptation generally does not eliminate the safety gains from programmes, but tends to reduce the size of the expected effects"
For example, it has been observed that motorists drove closer to the vehicle in front when their vehicles were fitted with anti-lock brakes. There is also evidence that the risk compensation phenomenon could explain the failure of condom distribution programs to reverse HIV prevalence and that condoms may foster disinhibition, with people engaging in risky sex both with and without condoms.
By contrast, shared space is an urban street design method which consciously aims to increase the level of perceived risk and uncertainty, with the intention of slowing traffic and reducing the number and seriousness of injuries.
Overview Risk compensation is related to the broader term behavioral adaptation, which includes all behavior changes in response to safety measures, whether compensatory or not. However, since researchers are primarily interested in the compensatory or negative adaptive behavior, the terms are sometimes used interchangeably. "A term, closely related to risk compensation, is 'behavioural adaptation'. Behavioural adaptation is a wider term referring to all behavioural changes triggered by a safety measure (OECD, 1997). Strictly spoken, this includes all positive and negative behavioural changes induced by road safety measures. Nevertheless, the emphasis is primarily put on the negative aspects of this phenomenon." The more recent version emerged from road safety research after it was claimed that many interventions failed to achieve the expected level of benefits but has since been investigated in many other fields. "Risk compensation is the term given to a theory which tries to understand the behaviour of people in potentially hazardous activities. In the context of the road user, risk compensation refers to the tendency of road users to compensate for changes in the road system that are perceived as improving safety by adapting behaviour. (Elvik and Vaa, 2004). So measures, designed to improve traffic safety, may bring along negative consequences in a way that individuals increase the riskiness of their driving behaviour because they feel safer (Dulisse, 1997)" "The early risk compensation literature deals with road safety... Several recent studies examine risk compensation in response to both aggregate and specific consumer product and workplace safety regulations"
Peltzman effect The reduction of predicted benefit from regulations that intend to increase safety is sometimes referred to as the Peltzman effect in recognition of Sam Peltzman, a professor of economics at the University of Chicago Booth School of Business, who published "The Effects of Automobile Safety Regulation" in the Journal of Political Economy in 1975 in which he controversially suggested that "offsets (due to risk compensation) are virtually complete, so that regulation has not decreased highway deaths". Peltzman claimed to originate this theory in the 1970s but it was used to oppose the requirement of safety equipment on trains in the Nineteenth Century.
A reanalysis of his original data found numerous errors and his model failed to predict fatality rates before regulation. According to Peltzman, regulation was at best useless, at worst counterproductive. "This conclusion startled the road safety community and challenged the role of government in attempting to improve safety through regulation. In Peltzman's view, government regulation was useless and perhaps even counterproductive." Peltzman found that the level of risk compensation in response to highway safety regulations was complete in the original study. But "Peltzman's theory does not predict the magnitude of risk compensatory behaviour." Substantial further empirical work has found that the effect exists in many contexts but generally offsets less than half of the direct effect. In the U.S., motor vehicle fatalities per capita declined by more than half from the beginning of regulation in the 1960s through 2012. Vehicle safety standards accounted for most of the reduction, augmented by seat belt use laws, changes in the minimum drinking age, and reductions in teen driving.
The Peltzman effect can also result in a redistributive effect where the consequences of risky behaviour are increasingly felt by innocent parties (see moral hazard). By way of example, if a risk-tolerant driver responds to driver-safety interventions, such as compulsory seat belts, crumple zones, anti-lock brakes, etc., by driving faster with less attention, then this can result in increases in injuries and deaths to pedestrians.
Risk homeostasis Risk homeostasis is a controversial hypothesis, initially proposed in 1982 by Gerald J. S. Wilde, a professor at Queen's University in Canada, which suggests that people maximise their benefit by comparing the expected costs and benefits of safer and riskier behaviour and which introduced the idea of the target level of risk. "The level of risk at which the net benefit is expected to maximize is called the target level of risk in recognition of the realization that people do not try to minimize risk (which would be zero at zero mobility), but instead attempt to optimize it" He proposed four constituents to a person's calculations relating to risk: "Besides macroeconomic influences, there are other factors that influence the level of accepted risk; these are of a cultural, social, or psychological kind. In general, the amount of risk that people are willing (in fact, prefer) to take can be said to depend on four utility factors and will be greater to the extent that factors..." Expected benefits of risky behavior (e.g., gaining time by speeding, fighting boredom, increasing mobility) Expected costs of risky behavior (e.g., speeding tickets, car repairs, insurance surcharges) Expected benefits of safe behavior (e.g., insurance discounts for accident-free periods, enhancement of reputation for responsibility) Expected costs of safe behavior (e.g., using an uncomfortable seat belt, being called a coward by one's peers, time loss)
Wilde noted that when Sweden changed from driving on the left to driving on the right in 1967, this was followed by a marked reduction in the traffic fatality rate for 18 months, after which the trend returned to its previous values. He suggested that drivers had responded to increased perceived danger by taking more care, only to revert to previous habits as they became accustomed to the new regime. "In the fall of 1967 Sweden changed over from left hand to right hand traffic. This was followed by a marked reduction in the traffic fatality rate. About a year and a half later, the accident rate returned to the trend before the changeover." A similar pattern was seen following Iceland's switch from left- to right-hand driving.
In a Munich study, part of a fleet of taxicabs was equipped with anti-lock brakes (ABS), while the remainder had conventional brake systems. In other respects, the two types of cars were identical. The crash rates, studied over three years, were a little higher for the cabs with ABS, Wilde concluded that drivers of ABS-equipped cabs took more risks, assuming that ABS would take care of them; non-ABS drivers were said to drive more carefully since they could not rely on ABS in a dangerous situation.
The idea of risk homeostasis is disputed. One author claimed that it received "little support", "The extreme views of risk homeostasis have attracted little support" another suggested that it "commands about as much credence as the flat earth hypothesis", "Risk homeostasis is not a theory. It is a hypothesis that repeatedly has been refuted by empirical studies. As Evans has noted, it commands about as much credence as the flat earth hypothesis" a third noted that the proposal did create considerable media attention: "What set the debate alight, rather like petrol on flames, was the proposition in 1982 that road users did not just adapt to perceptions of changing risk through compensatory behaviors, but that the process was a homeostatic one, producing overall equilibrium in safety-related outcomes"., 'Early Theories of Behavioural Adaptations' by Oliver Carsten: "What set the debate alight, rather like petrol on flames, was the proposition in 1982 that road users did not just adapt to perceptions of changing risk through compensatory behaviors, but that the process was a homeostatic one, producing overall equilibrium in safety-related outcomes" Others claimed that road fatality statistics, which have fallen considerably since the introduction of safety measures, do not support the theory.
Preventive measures To create preventive measures in order to make a certain activity safer, risk compensation and risk compensation behavior have to be mapped in order to evaluate whether the measures are effective. When measures create risk compensation, this might nullify the measures. Then the measures might not lead to fewer injuries or, in worst cases, enhance injuries.
Examples
Road transport
Anti-lock brakes Anti-lock braking systems are designed to increase vehicle safety by allowing the vehicle to steer while braking.
A number of studies show that drivers of vehicles with ABS tend to drive faster, follow closer and brake later, accounting for the failure of ABS to result in any measurable improvement in road safety. The studies were performed in Canada, Denmark, and Germany.Grant and Smiley, "Driver response to antilock brakes: a demonstration of behavioural adaptation" from Proceedings, Canadian Multidisciplinary Road Safety Conference VIII, June 14–16, Saskatchewan 1993. A study led by Clifford Winston and Fred Mannering, a professor of civil engineering at the University of South Florida supports risk compensation, terming it the "offset hypothesis". A study of crashes involving taxicabs in Munich of which half had been equipped with anti-lock brakes noted that crash rate was substantially the same for both types of cab, and concluded this was due to drivers of ABS-equipped cabs taking more risks.
However, the Insurance Institute for Highway Safety released a study in 2010 that found motorcycles with ABS were 37 percent less likely to be involved in a fatal crash than models without ABS. A 2004 study found that ABS reduced the risk of multiple vehicle crashes by 18 percent, but had increased the risk of run-off-road crashes by 35 percent.
Seat belts A 1994 research study of people who both wore and habitually did not wear seatbelts concluded that drivers were found to drive faster and less carefully when belted.
Several important driving behaviors were observed on the road before and after the belt use law was enforced in Newfoundland, and in Nova Scotia during the same period without a law. Belt use increased from 16 percent to 77 percent in Newfoundland and remained virtually unchanged in Nova Scotia. Four driver behaviors (speed, stopping at intersections when the control light was amber, turning left in front of oncoming traffic, and gaps in following distance) were measured at various sites before and after the law. Changes in these behaviors in Newfoundland were similar to those in Nova Scotia, except that drivers in Newfoundland drove more slowly on expressways after the law, contrary to the risk compensation theory.