Which of the following best explains why seat belt laws can sometimes lead to an increase in reckless driving, according to the principle that people respond to incentives?

• A. Seat belt laws have no effect on driver behavior.
• B. Seat belt laws reduce the incentive to purchase cars.
• C. Seat belt laws make driving safer, so drivers may take more risks.
• D. Seat belt laws increase the cost of driving, so fewer people drive.

Answer: (C)

Verified step by step guidance

1. Understand the principle that people respond to incentives, which means individuals adjust their behavior based on perceived costs and benefits.
2. Recognize that seat belt laws increase safety by reducing the risk of injury in accidents, effectively lowering the perceived cost of risky driving behavior.
3. Analyze how this reduced perceived cost can change driver behavior: since drivers feel safer, they might be more willing to engage in reckless driving, as the personal consequences seem less severe.
4. Identify that this behavioral change is an example of a moral hazard, where safety measures lead to riskier behavior because the negative consequences are mitigated.
5. Conclude that the best explanation is that seat belt laws make driving safer, so drivers may take more risks, illustrating how incentives influence behavior.