Moral Hazard in Traffic Games

A two-person game-theoretical model is suggested in order to explain traffic safety behaviour among road users. A road userʹs outcome is dependent on her and her opponentʹs attitude towards aggression, her and her opponentʹs level of attention, as well as on external traffic safety conditions. The existence and size of moral hazard effects for different outcomes of the game are discussed, and an evolutionary equilibrium, endogenously defining the share of aggressive road users, is deduced, and shown most likely to increase as external safety improvements take place.