Previous research has indicated that individual compensating behavior, specifically, more risky driving may reduce the effectiveness of seat belt laws. We test the compensating‐behavior hypothesis using individual‐specific survey data. The analysis also incorporates individual risk tastes. Our results indicate that the compensating‐behavior hypothesis applies only to those that are not strongly risk averse. Other risk‐differentiated groups do not exhibit compensating behavior. Finally, it seems that individuals learn to reduce compensating behavior over time.
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Singh et al. (1992) studied this question.
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