Monday, January 18, 2010

Forget Gum. Walking and Using Phone is Risky.

New York Times article "Forget Gum. Walking and Using Phone is Risky" (January 16th, 2010) makes much ado about nothing. It notes a rise in accidents while text messaging, and suggests a problem.

Slightly more than 1,000 pedestrians visited emergency rooms in 2008 because they got distracted and tripped, fell or ran into something while using a cellphone to talk or text. That was twice the number from 2007, which had nearly doubled from 2006, according to a study conducted by Ohio State University, which says it is the first to estimate such accidents.

Text messages cost approximately $0.10 each, a relatively conservative estimate (noting that while there is little marginal cost, individuals do choose contracts for text messages, reach their constraint a fair amount of the time, and by definition value them as equal to or more than what they have to pay). Corrections notes possible objections to the $0.10 number but is willing to conjecture it as within an order of magnitude for value, and all conclusions made are robust to an order of magnitude change in value. There were approximately 1.6 trillion text messages sent in 2009. Let's imagine that only 10% of these messages were texted while walking or doing something that could send one to the hospital. Therefore, it appears that consumers value text messages at approximately $16 billion or more.

This amounts to $16 million per hospital visit, a paltry number.

The times offers the following:

'An animal would never walk into a pole,' he said, noting survival instincts would trump other priorities.

It appears to Corrections that this remark is denigratory. It is worth noting, of course, that individuals can intertemporally displace when they text to "safer" times. If we imagine that they can avoid all accidents for a one-percent loss in value, they would lose 160 million in value, paying $160,000 to avoid every hospital visit. It appears to Corrections that "survival instincts" are too costly for homo economicus.

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