Killer Facts: Terrorism, Car Crashes and Behavioural Economics

A telling statistic from an article by John Lanchester in the Guardian about the “justification” for the surveillance society revealed by Edward Snowden’s leaks about GCHQ, the NSA and the Prism programme. “Since 9/11, 53 people have been killed by terrorists in the UK. Every one of those deaths is tragic. So is every one of the 26,805 deaths to have occurred on Britain's roads between 2002 and 2012 inclusive, an average of 6.67 deaths a day. Let's call that the SDRD, standard daily road deaths. The terrorist toll for 12 years comes to 0.0121 SDRD. This means that 12 years of terrorism has killed as many people in the UK as eight days on our roads.”

Behavioural economics can help explain how this happens. First, the availability heuristic says that we assume that the more available some piece of information is to memory, the more we must have experienced it in the past (and the more likely it is to happen again). So newspaper stories featuring spectacular events like murders or fires or terrorism are vivid, salient and available to memory. And salience and vividness aid ease of recall. If something stands out from everything else, we think it’s more likely to happen. Even if it actually isn’t. Something to think about next time you get in a car. Or the next time a politician invokes the "war on terror."

John Lanchester, “The Snowden files: why the British public should be worried about GCHQ.” The Guardian, Thursday 3 October 2013

Hunt the Heuristic: “Public Transport is Slow and Expensive”

“Traditional” economics assumes that we are rational decision makers. Behavioural economics shows us why this is often not true, frequently because of heuristics. The latter are rules of thumb that steer our decisions, even though we are often not aware of them, or they may not be true. How come heuristics are important? And what do they have to do with owning a car? When it comes to decisions about personal mobility, one of the most common heuristics is “Public Transport is Slow and Expensive.” Sometimes, this can be true. Often it isn’t. Speaking at the UK Public Health Association in Bournemouth this week, I did the return trip by train. The walk-on, off-peak fare (using a Network Railcard) was £14 return from Hove to Bournemouth. Google Maps puts the distance at around 95 miles each way, 190 miles for the return trip. Based on HMR&C’s standard rate for a car, 40p a mile, doing the return trip by car costs £76. On top of the train fare, and because it was raining, we’ll add in taxi fares from home to Hove station, and from Bournemouth station to the hotel - another £10. Then £5 from the conference centre back to the station, ditto from Hove to home (still raining!). Which adds up to £34 by public transport versus £76 in a car. Half the price, using public transport! Which seems a bit of a bargain, given that it also includes paying the wages of the people who are doing the thing that I didn’t have to do – driving the train, or steering the cab. And because I wasn’t doing the driving, I was free to do other things. So what about the time saved by car? With no traffic hold-ups en route (a big assumption), the journey time could have been about twenty minutes quicker each way by car. Which doesn’t include the time spent parking, getting a windscreen sticker from the hotel, putting petrol in the tank, etc. So the key question becomes, is it worth a premium of £42 to save around 40 minutes (there and back)? For the pleasure of driving along rain-swept motorways in the dark. Not to mention the risks. Which is why, before making a decision, it’s always a good idea to play “hunt the heuristic.”