A comprehensive analysis of external costs of accidents
A comprehensive analysis of external costs of accidents

Summary/Abstract: Research background: This paper focuses on the concept of external costs in transportation and the implications of incorporating them into decision-making processes. It highlights that external costs of transport encompass the disparity between social costs, representing all expenses associated with transport infrastructure provision and usage, and private costs borne by individual transport users. The absence of market incentives prevents transport users from considering external costs, leading to account for only a part of social costs when making transport decisions, which ultimately leads to suboptimal outcomes. Thus, internalisation of external costs represents a crucial part of the decision-making process for transport users. Purpose of the article: The purpose of this article is to provide a theoretical approach to the research problem of internalisation of external costs into decision-making processes in transportation. It aims to define the concept of external costs, the methods used for quantification of externalities and show current state of transport accident costs in EU and nonEU countries. Methods: This study was conducted through a research design and methodology that involved existing literature analysis, collecting input values on external costs of transport, and assessing the current stage of internalisation of externalities in various countries and transport modes. The sample size included relevant countries and a specific period of time. Findings & Value added: The paper provides an overview of the input values and methodologies used to provide estimates for the external costs of transport. Moreover, the paper presents total, average and marginal external costs for all relevant countries. The current extent of internalisation of external costs by current taxes and charges for all countries and transport modes. It also investigates recommended options for further internalisation.

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