We investigate the causal link between driver cell phone use and crash rates by exploiting a natural experiment induced by the 9 pm price discontinuity that characterizes a majority of recent cellular plans. We first document a 7.2 percent jump in driver call likelihood at the 9 pm threshold. Using a prior period as a comparison, we next document no corresponding change in the relative crash rate. Our estimates imply an upper bound in the crash risk odds ratio of 3.0, which rejects the 4.3 asserted by Redelmeier and Tibshirani (1997). Additional panel analyses of cell phone ownership and cellular bans confirm our result.
That is from a recently published paper by Saurabh & Pathania (American Economic Journal: Economic Policy, August 2013). A draft is here.
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