Abstract:
On October 23, 1981, the head of the National Highway Traffic and Safety Administration announced that it was rescinding regulations that would have required the installation of passive restraint systems in all automobiles, beginning with model year 1984. Eight months later, a federal judge ordered NHTSA to reconsider, arguing that the agency "drew conclusions that were unsupported by evidence on the record and then artificially narrowed the range of alternatives available to it under its legislative mandate."
Learning Objective:
This case focuses on assessing the potential costs and benefits of passive restraints in reducing traffic fatalities, and reviews possible alternatives to a passive restraint standard. The case may also serve as a vehicle to discuss the ethical basis for paternalism: When does the government have the right or obligation to require that its citizens protect themselves? More narrowly, the case may be used in economics classes to demonstrate the concept of market failure.
