The Peltzman Effect at Work
Mandatory seatbelts cut driver deaths. They raised pedestrian deaths. Drivers drove faster when they felt safer. The same pattern runs through workplace safety programs.
In 1975, economist Sam Peltzman published a study showing that the U.S. mandatory seatbelt law had cut traffic fatalities among drivers, exactly as designed. It had also raised fatalities among pedestrians and cyclists by a comparable margin. Drivers drove faster when they felt safer. The total death count barely moved.
The pattern has replicated since: cycling helmets, ABS brakes, anti-lock systems on motorcycles. Each protective measure shifts who absorbs the residual risk rather than removing it.
Workplace translation is uncomfortable. Comprehensive wellness programs correlate with higher (not lower) reported burnout. Unlimited PTO correlates with fewer days actually taken. Stronger anti-harassment policies sometimes coexist with more over-compliance theater and less honest reporting. Protection allows the protected behavior to scale.
The mechanism is risk compensation. Given a wider safety margin, people consume some of it by taking more of the underlying risk. The new equilibrium is often the same harm, redistributed.
The nudge: Before rolling out the next protective program, ask one question. What behavior will this allow people to do that they couldn't do before? That behavior, not the policy, is what you'll be managing in six months.
