Dr Duncan Mortimer
The effect of "smart' financial incentives on driving behaviour of novice drivers
Recent studies have demonstrated that financial incentives can improve driving behaviour but high value incentives are unlikely to be cost-effective and attempts to amplify the impact of low value incentives have so far proven disappointing. The present study was designed to evaluate the practical significance of motivational crowding out when offering low-value financial incentives for safe driving, and the extent to which gain/loss asymmetry may be exploited to amplify the effectiveness of financial incentives.
The findings of the study suggest that it may be possible to design "smart' but cheap incentives that offer a better balance between costs and benefits. Findings from the present study and the broader literature are currently being used to optimise the design of financial incentives embedded within PAYD-insurance, with the cost-effectiveness of these incentives for reducing risky driving behaviours in novice drivers to be evaluated in on-road trials.
Dr Duncan Mortimer is an Associate Professor (Research) and Head of Teaching at Monash University's Centre for Health Economics (CHE). He holds academic qualifications in economics and psychology from the University of Adelaide and in economics and health economics from Monash University. His current research interests include the economics of charitable giving, the role of incentives in promoting pro-social behaviours, and the effectiveness and cost-effectiveness of behavioural economics strategies in promoting healthy lifestyle.
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