Economic costs of poor road management
Once the Huang He river was known as the river of sorrow in China and the river's deadly floods were seen as acts of God. But the Chinese regime changed this narrative through its long-term planning and by transforming the threats into irrigation opportunities.
Unfortunately, our policymakers fail to understand this concept when it comes to road accidents in the country. Deaths on roads can never be curbed without correcting institutions and thus having a long-term plan. Merely giving advice in the wake of gruesome accidents won't work unless we enforce a speedier, separate judiciary for road accidents and combat trade unionism of big vehicle owners. To become an upper middle-income country, we have to address the issue of a large number of illegal drivers and unfit vehicles on our roads.
It's not the case that countries first become developed and then improve road governance. To take our country to the next stage of development, including increasing potential employment and output, we have to ensure better road safety first and foremost. In the last 15 years, the US reduced accidents by 13 percent while Spain's success in this respect is exemplary—it reduced deaths from road accidents by 70. We won't find any country that graduated to upper-middle category without seriously fixing its transport sector. But we dare dream to do so without addressing the cancer running through the veins of the economy.
Making drivers and vehicle owners follow standard practice is going to be politically expensive in the short run. And banking on this political weakness, wrongdoers have been enjoying near full impunity for killing people on roads, which has made the transport business the most anarchic sector in the country. This syndrome has corrupted our psyche to the point of accepting all deaths on roads, particularly before and after holidays, as simply “acts of God”. No, they aren't! These casualties are the inevitable outcome of non-professional drivers, unfit vehicles, often wrongly planned roads, and, above all, appallingly poor street governance. It's all about institutions that can bring the change we deserve.
We hardly see economists commenting on road accidents. But the economics behind it is important. Traffic accidents eat up two to three percent of GDP, as per the World Health Organisation. Low-income countries account for one percent of vehicles globally but they are responsible for 16 percent of total traffic casualties whereas high-income countries account for nine percent of all casualties despite having 46 percent of vehicles globally. Accidents are high in middle-income countries which account for the other 53 percent of vehicles but 75 percent of total accidents. Countries whose institutions and law enforcement lag behind their rate of urbanisation experience more traffic fatalities. Bangladesh falls in this category and the condition of its roads is totally incompatible with its moderately high growth.
Accidents rise with urbanisation and the rate of motorisation (the number of vehicles per thousand people). But the relationship doesn't remain positive or linear, once laws are strictly enforced. In addition, the length of mileage travelled per capita raises the probability of an accident. Bangladesh's urbanisation (35 percent as of 2016) still isn't too high and is almost the same as India, but our motorisation rate (five vehicles per thousand people) is still one of the lowest in the world—almost one-tenth of India.
Moreover, the mileage travelled per capita, which is always high in big countries, is low in Bangladesh once its area and shape are considered. In contrast to all three favourable factors, the rate of accidents in Bangladesh is prematurely one of the highest in the world, warranting serious attention from the government. It would otherwise be judicious of us to go back to the age of Devdas who travelled to meet Parvati using a cow cart that is less likely to cause deaths due to collision.
Simple math will show why Bangladesh's traffic death toll is comparatively high. Last year, 140,000 lives were lost on the roads of India. Our population is one-eighth of India's, the motorisation rate one-tenth, and mileage, at least another one-fifth (geographically India is 22 times bigger). Taking all these factors into account, our death toll shouldn't exceed 500 to 1,000 per year, but our “efficient” drivers have already killed almost 2,500 people in the last six months.
So why are there so many deaths on the road? One of the reasons is the “automatic promotion” in the transport sector. Here most conductors—who engage in fights with defiant passengers, who see nothing wrong with driving buses that are in a horrible state, and who hurl abusive words at other vehicles while in motion—are automatically promoted to full drivers whenever their bosses are tired or absent. Who cares about licenses? Bribes can buy them if required. Since the capacity of labour absorption in agriculture is falling (which was once 80 percent but is now 40 percent), the sector is annually releasing thousands of workers who eventually resort to entering informal employment sectors of trading, petty businesses, construction, and transport without any institutional training. The government has to fill that gap by enacting laws and setting training institutes in every district.
Construction and transport workers without proper education and training are at the root of many manmade disasters, causing a huge tally of deaths from building collapses and reckless driving. The probability of accidents is more than double among drivers between 16 and 30. Hence, the government should set the minimum age for professional drivers to at least 20 years of age, as well as require them to have some basic education. The minimum age in developed countries is lower only because their high schools provide free driving lessons to all students. Bangladesh can also reduce the minimum age in the future, once institutional support is provided.
Despite some resistance from different quarters with vested interests, the minimum education plus age requirement will help the economy in four ways: 1) it will reduce accidental deaths; 2) it will hugely absorb a bigger segment of the educated unemployed; 3) discourage school dropouts and the desperation to earn at an early age; and 4) invite more graduate youths into this profession which may increase the country's formal sector employment from only 15 percent, giving a boost to the worrisome low employment rate in the country.
Biru Paksha Paul is an associate professor of economics at the State University of New York at Cortland. Email: firstname.lastname@example.org