SAFETY AND

ECONOMICS
A GROUP 6 PRESENTATION
 SAFETY
01 02 03
Definition Relation Factors
What is safety? What is Transportation What are the Factors Involved in
Safety? Transportation Crashes?

04 05 06
Accidents Causes Prevention
Transportation Accidents in the Cause of Road Accidents in the How to lessen transportation
Philippines Philippines Accidents?
“Safety has to be everyone’s
responsibility… everyone
needs to know that they are
empowered to speak up if
there’s an issue.”
– Captain Scott Kelly.
 01
What is
Safety?
Safety
-The word safety refers
to your freedom from danger,
injury and damage, and to your
personal security.
Share of deaths
caused by
transport
accidents in the
Philippines
from 2017 to
2023
https://www.statista.com/statistics/1367365/philippines-deaths-from-transport-accidents/
02
Transportation
Safety
 Transportation safety
performance is linked to
a variety of elements,
including roadway
design, traffic law
enforcement, road user
behavior, and
emergency response
time.
ACCIDENTS VS INCIDENTS

Accidents Incidents
unfortunate event that the happening of an
occurs suddenly unusual event which may
unexpectedly, that causes disturb the routine of a
damage or injury. person.
-always unintentional.
 03
Factors Involved in
Transportation
Crashes
 Factors Involved in Transportation Crashes

Driver or Vehicle Roadway Environment

Operator Action Condition Condition
Unfamiliarity with
Faulty Road cracks, Weather and
roadway
brakes,electrical pavement, Geography
conditions,
system, worn shoulders,
traveling at high
tires, and the intersections, and
speeds,
location of the the traffic control
drowsiness,
vehicle’s center of system
drinking, and using
gravity.
a cell phone .
04
Accidents in
the Philippines
Accidents in the Philippines
 05
Causes of
Accidents in
the Philippines
5 Common Causes of Accidents in
the Philippines

Over Speeding Influence of Bad Overtaking

Alcohol

Improper Turning Jaywalking

5 common Causes of accidents in the
Philippines

Over Speeding
01
Exceeding the speed limit is also one of the common
causes of road-related deaths and injuries in the
Philippines.
Not only is it because there are no designated officers to
catch over-speeders, but also because some drivers are
not really aware of the standard Speed Limit Law
Philippines.
5 common Causes of accidents in the
Philippines

Influence of
02
Alcohol Drinking alcohol with friends, relatives, and co-workers
is among the most common
pastime and bonding moments of Filipinos; that maybe
the reason it is one of the top causes of
road-related accidents in the country.
5 common Causes of accidents in the
Philippines

Bad Overtaking
03
If you’ve been driving for years and long-distance, you
might have come to a point where you’ve
seen road accidents due to bad overtaking or near-death
situations because the driver overtaking
almost collided with a bus or another car.
5 common Causes of accidents in the
Philippines

Improper Turning
04
Most drivers in the Philippines are not so fond of using
the turn signal light, or we
use it but it is already too late. We might all, at some
point in our lives, be guilty of this.
5 common Causes of accidents in the
Philippines

Jaywalking 05
Road accidents happen not just because of motorists but
also because of individuals on foot.
Jaywalking is the number one reason people are hit with
cars.
 06
Improving
Road Safety in
the Philippines
How to lessen Accidents in the Philippines

Driver
Licensing and
Education
There is a call for stricter
driver licensing controls and
improved driver education
programs to address the high
number of accidents caused by
driver error.
How to lessen Accidents in the Philippines

Awareness and
Media
Campaigns
Continual efforts to raise
public awareness about road
safety are proposed. This
includes utilizing various
media channels effectively to
educate and inform the public
about safe driving practices.
How to lessen Accidents in the Philippines

Accident Data
Collection and
Analysis
Suggest a comprehensive
system for collecting,
processing, and analyzing
accident data to improve
understanding of road safety
issues.
How to lessen Accidents in the Philippines

Road
Environment
Improvements
Highlighting the impact of road
design on accident rates, the
passage urges careful analysis
and planning before
implementing changes.
How to lessen Accidents in the Philippines

Preventive
Measures
Recommendations include
placing appropriate traffic
control devices at hazardous
locations such as road
construction sites to minimize
accidents, particularly at night.
 ECONOMICS
07 08 09
Transportation Relation Factors
Economics What is Transportation What are the Factors Involved in
What is safety? Safety? Transportation Crashes?

10 05 06
Philippines Causes Prevention
Transportation Accidents in the Cause of Road Accidents in the How to lessen transportation
Phillipines Philippines Accidents?
“Economy is the method by which
we prepare today to afford the
improvements of tomorrow.”
-Calvin Coolidge
 07
Transportation
Economics
What is transporation Economics
 Transportation Economics
is a branch of micro-economics which has different
unique issues such as;
The demand for transportation is not direct, but is
derived
the consumption of each transportation facility (i.e.,
each trip) is unique in time and space
technological differences among different modes and
economies of scale
governmental interventionist policies and regulations
in transportation

TRANSPORTATION ECONOMICS - examines how resources are allocated to produce and

distribute transportation services, considering both the supply of infrastructure and vehicles,
and the demand from individuals and goods for transportation services they can afford.
Transportation Economics
Scope of Transportation Economics
Transportation economics specifically addresses
demand of transportation services, supply of
transportation facilities, elasticities of demand and
supply, price mechanisms, and transportation cost
analysis.
 Transportation Economics
The Transportation Economics is divided into two main branches

Macroeconomics

Microeconomics
Transportation Economics

Macroeconomics
focuses on the overall economy of a region or
country, examining aggregate concepts like
national income, employment levels, and
inflation rates.
Transportation Economics

Microeconomics
on the other hand, studies the behavior of
individual entities such as firms and
households, analyzing their decision-making
processes regarding production, consumption,
and pricing within specific markets.
Transportation Economics

Microeconomics
on the other hand, studies the behavior of
individual entities such as firms and
households, analyzing their decision-making
processes regarding production, consumption,
and pricing within specific markets.
Transportation Economics
Importance

The Transportation sector moves goods and people,

employs millions of workers, generates revenue, and
consumes materials and services produced by other
sectors of the economy.
 08
DEMAND AND
SUPPLY
Transportation demand and supply
 Analysis of Transportation Demand
It examines how factors like consumer income and the cost and characteristics of a
transportation facility influence the demand for that facility.

It involves analyzing demand functions, which show how willing consumers are to use the
transportation service at different prices, and demand models, which estimate the likelihood
of individuals choosing one transportation option over others.

It involves
analyzing demand functions, which show how willing consumers are to use the
transportation service at different prices

and demand models, which estimate the likelihood of individuals choosing one
transportation option over others.
Analysis of Transportation Demand

A transportation demand function graph, like the one in Figure 5-1, shows
how much travel people are willing to make by transit at different fare
levels. This function is crucial for planning because it helps predict demand
based on price and other factors like travel time, comfort, and user
income. Changes in these factors, such as rising unemployment or
increased auto costs, can shift the demand curve. An increase in demand
shifts the curve upward (D1 → D2), while a decrease shifts it downward
(D1 → D3).
Transportation Demand Functions
A basic feature of transportation systems analysis is the prediction of transportation
demand orchanges thereof.

Transportation demand models, predict travel volume based on

different service levels and reflect how individuals or groups will alter
their transportation choices in response to changing conditions.

In transportation economics, a "trip maker" is a consumer seeking to use

transportation services. There are two types of demand functions used
in this context.
 Transportation Demand Functions
1. Disaggregate demand functions: these predict the behavior of a single
consumer in response to changes in future conditions.

2. Aggregate demand functions: these predict the behavior of a group of

consumers such a household, in response to changes in future conditions.

Disaggregate demand functions are newer compared to aggregate demand functions. Aggregate demand functions
group transportation demand into market segments based on geographic areas known as traffic analysis zones (TAZs).

The Gravity Model The mcylynn Model

The Kraft-SARC Model Baumol-Quandt Model

Analysis of Transportation Supply

The supply of a transportation product is the quantity

producers are willing to offer at various prices,
influenced by factors like quality and production costs. A
supply function, shown in Figure 5-3, indicates the
amount of transportation product available at different
prices and helps in planning by predicting future supply
levels. The supply curve reflects the relationship
between supply and price, influenced by factors such as
travel time, comfort, technology, and regulations.
Changes in these conditions can shift the supply curve,
as depicted in Figure 5-4. Increased supply can result
from physical expansions like adding more vehicles or
roads, or through technological improvements like
intelligent transportation systems, which enhance supply
without physical changes.
Equilibrium of Transportation Demand and Supply

The transportation demand function, like the

supply function, relates the quantity of goods to
their price. Both functions suggest that there
may be a point where the quantity demanded
equals the quantity supplied, indicating an
equilibrium state.
 Sensitivity of Travel Demand

In planning and evaluating transportation systems, understanding how changes

in system attributes or the environment affect transportation demand is
crucial. For instance, changes in the price of a transportation mode can impact
its demand. By using the travel demand function, planners can derive a marginal
effects model to estimate various outcomes, such as:

Change in demand in response to unit change in attribute

Change in demand in response to unit percent change in attribute

Percent change in demand in response to unit percent change in attribute

Interpretation of Price Elasticities

Values of price elasticities with respect to

demand make it possible for transportation
operators to predict the impact of changing
transportation prices on total revenue.
 09
FACTORS
AFFECTING
ELASTICITY
Income Elasticities
-elasticity of demand
.with respect to income.

-is the change in

demand for a good in
response to a unit
change in income of the
consumer of that good.
In transportation economics, a good service is considered normal if there is
a direct relationship between the demand for that commodity and the
income of the consumer.

Positive Income Elasticity: When income increases, the demand for

transportation services also increases. This positive income
elasticity means that transportation is a normal good.

Negative Income Elasticity: In some cases, demand for certain

types of transportation might decrease as income rises. This would
imply that the demand for public transportation is negatively
related to income, making it an inferior good in this context.
Price Elasticities
-the change in demand
for a good in response to
a unit change in the price
of the good.

-it is important because

it is often sought to
assess the impacts of
changing prices of a
good or rival goods.
 Price Elasticity of Demand

Elastic PED > 1 small change in price leads to a relatively large change in the quantity
demanded.
Demand

Inelastic PED < 1 changes in price lead to a smaller proportional change in the quantity
Demand demanded.

Unitary Elastic PED = 1 revenue from transportation services remains unchanged when the
Demand price changes, as the drop in quantity demanded exactly offsets the
increase in price, or vice versa.
Perfectly Elastic PED = ∞ consumers would only buy transportation services at a specific price
Demand and would not purchase at any other price. This is rare in real-world
transportation markets.
Perfectly the quantity demanded remains constant regardless of price changes.
Inelastic Demand PED = 0
This implies that consumers will continue to buy the same amount of
transportation services no matter how the price fluctuates.
Direct and Cross Elasticities
-In transport economics, direct elasticity and cross elasticity refer
to how changes in the price of one good or service affect the
demand for another good or service.
Direct Elasticities Cross Elasticities
Direct elasticity of demand, Cross elasticity of demand
often simply referred to as measures how the quantity
price elasticity of demand, demanded of one good or
measures the responsiveness service responds to a change
of the quantity demanded of in the price of another good
a good or service to a change or service.
in its own price.
Substitute and Complementary Goods

Substitute goods Complementary goods

can be used instead of are consumed together
one another and provide and are of no use when
the same level of consumed alone.
satisfaction.
Ex: Mobile Phones and Sim Cards, Petrol and
Ex: Coke and Pepsi, Butter and margarine, Tea Cars, Movies and Popcorn, Shoes and Insoles,
and coffee, Cars and motorbikes Pencils and Notebooks
 10
APPLICATIONS
OF PRICE
ELASTICITIES
CONSUMER SURPLUS
-is a measure of the monetary value made
available to consumers by the existence of a
facility.
-the difference between what the consumers
might be willing to pay for a service and what
they actually pay.
LATENT DEMAND
-is the desire for a product or service that
consumers cannot satisfy due to financial,
availability or awareness reasons.
Practical Applications of Price Elasticity
of Demand

Pricing Decisions Formulation of

Government Policies

Price
Discrimination Under Monopoly
https://www.economicsdiscussion.net/elasticity-of-demand/practical-applications-of-price-elasticity-of-demand/3515
Practical Applications of Price Elasticity
of Demand

-Refer to one of the major role of price

elasticity of demand. The price elasticity of
demand helps an organization to
Pricing Decisions determine the price of its products in
various circumstances.

https://www.economicsdiscussion.net/elasticity-of-demand/practical-applications-of-price-elasticity-of-demand/3515
 Practical Applications of Price Elasticity
of Demand

-Refers to an important significance of the

concept of price elasticity of demand. The
government takes into consideration the
Formulation of price elasticity of demand while planning
Government Policies taxes.

https://www.economicsdiscussion.net/elasticity-of-demand/practical-applications-of-price-elasticity-of-demand/3515
 Practical Applications of Price Elasticity
of Demand
-Refers to a situation when different prices
are charged from different consumers.
This implies high prices are charged from
consumers whose demand does not
Price change with change in the price of
Discrimination products. On the other hand, a monopolist
charges less prices from consumers
whose demand is elastic.

https://www.economicsdiscussion.net/elasticity-of-demand/practical-applications-of-price-elasticity-of-demand/3515
 Practical Applications of Price Elasticity
of Demand

Refers to the fact that under monopolistic

market conditions, the price of products is
determined only on the basis of price
Under Monopoly elasticity of demand.

https://www.economicsdiscussion.net/elasticity-of-demand/practical-applications-of-price-elasticity-of-demand/3515
 11
COST ANALYSIS IN THE
EVALUATION OF
TRANSPORTATION
SYSTEMS
CONSUMER SURPLUS AND LATENT
DEMAND
To fully understand different investment options, you need to
weigh their benefits and drawbacks, especially the costs
involved in providing transportation services. There are three
main types of costs: fixed costs (like rent, which don't
change with production), variable costs (like materials, which
rise with production), and total costs (the sum of fixed and
variable costs). By figuring out these costs, you can predict
future expenses and decide which investments make the
most sense economically.
 CONSUMER SURPLUS AND LATENT
DEMAND
Economic Laws Related to Costs
Law of Diminishing Returns: States that an increase in input of one unit of a
factor ofproduction generally causes an increase in output, but only up to a
point, after whichincreasing inputs of that factor will result in progressively less
increase in output.

Law of Increasing Returns to Scale: States that in practice, the production of

units is often likely to increase at a faster rate than the increase in the factors of
production. This may be due to technological features, specialization.
 CONSUMER SURPLUS AND LATENT
DEMAND
Economic Laws Related to Costs

The relationships of the total and average cost functions are shown the Figure 5-10. It can be
seen tat as output q increases, the average cost of production decreases and then
increase at higher levels of production. When the production level reaches q', the average cost
is a minimum (c). The decrease in average cost with increasing output is referred to as
economies of scale. In the figure, there is obviously there is economy of scale for production
levels between 0 and q'. However, there is no economy of scale beyond q' because the average
cost increases. This concept is useful to engineers in deciding whether additional capacity or
growth would yield higher profits, and is important in the economic evaluation of
transportation system improvements.
CONSUMER SURPLUS AND LATENT
DEMAND
Economic Laws Related to Costs
 CONSUMER SURPLUS AND LATENT
DEMAND
Marginal Costs

The marginal costs of a transportation good or service is the additional cost associated with
the production of an additional unit of output. The following example illustrates the concepts
of average and marginal costs.
Table 5-3 presents the cost of running a train system with variable number of wagons.
For each system size, the fixed and variable costs are provided in the first three columns. The
total, average and marginal costs are then computed and presented in the next three columns.
CONSUMER SURPLUS AND LATENT
DEMAND
Marginal Costs
CONSUMER SURPLUS AND LATENT
DEMAND

Costs and Production

In general, a private company will continue to
produce and market a good or service as
long as it is returning a profit.
CONSUMER SURPLUS AND LATENT
DEMAND

Cost Elasticity
The cost elasticity of a good or service is
defined as the ratio of percentage change in
cost C to a unit percentage change in supply q.
The difference between cost elasticity and price
elasticity is obvious.
 CONGESTION PRICING
Urban congestion is currently a serious problem in most countries, causing over $70
billion in wasted fuel, travel time and air pollution in the US alone. Besidesapplyingan array of
traffic mitigation measures such as physical capacity increases, intelligent transportation
systems, and travel demand management, transportation agencies in many countries are
considering the imposition of penalties as a disincentive to travel in congestion- prone areas such
as central business districts.
 CONGESTION PRICING
In this system, drivers pay higher fees to travel
during peak congestion times, which aims to
reduce urban traffic jams. The average cost curve
(AC) in Figure 5-12 represents the typical travel
cost per trip, while the marginal cost curve (MC)
shows the cost of adding one more vehicle to
traffic. The demand curve (D-D) shows how many
trips are made at different prices. Ideally, setting
prices equal to marginal costs (OM vehicles per
hour) by applying a tax (GF) can optimize traffic
flow. This approach minimizes overall travel
costs but might restrict some trips (MN) that
would otherwise occur.
 CONCLUSION
Safe transportation has a wide range of positive effects,
impacting individuals, communities, and society as a
whole. it avoids accidents and especially improves the
economical growth and development of a country. So
why would us Filipinos start to improve our own
transportation? As we grow older our nation also
improves but not as far as the other countries does.
Whose to blame with? The Government? or Us the
citizens? We must remember our future doesn’t depends
on the Government but on the actions and choices we
made everyday. We can’t change the world if we can’t
change ourselves first.