Estimating the Cost of a Road Traffic Accident in Pakistan Using Human Capital Cost Approach

Abstract

Road Traffic Accident (RTA) is one of the leading causes of death in Pakistan and situation of road safety in Pakistan is worrisome. Thousands of people died and millions got injured due road traffic accidents every year in Pakistan. The road traffic accidents not only cause physical losses but economic losses and emotional losses are also associated with it. The survival of a family is questionable whose bread earner died or severely injured in RTA. The main objective of this study is to estimate the average cost of a road traffic accident using Human Capital Cost Approach at each severity level (fatal, major and minor accident) in Pakistan. For this purpose accident data was collected from rescue 1122 and NTRC. Reported RTA data, population data and data of registered vehicles were obtained from Pakistan Bureau of Statistic. Collect Questionnaire survey was conducted to collect the data on Medical cost, vehicle damage cost, vehicle downtime, judicial system cost and ERS. The cost estimation using human capital cost approach shows the average economic losses of Rs. 6.2 million, 1.4 million and 0.039 million occurred in case of fatal, major and minor RTA respectively. The analysis shows the total losses incurred in Punjab due to RTAs is Rs 188.5 billion that is more than 1 % of the GDP of Punjab and 11.21 % of the budget of Punjab.