The Effect of Traffic Density on The Accident Externality from Drivingthe Case Study of Tehran

Due to the growth of the automobile industry worldwide and increasing human demand for this vehicle, every day we see many accidents, around the world and especially in Iran. Based on experts research, Accidents cost includes a significant part of GDP, so that according to the most recent comprehensive study on the cost of traffic accidents, the cost amounts is about 7 percent of our gross national product whereas, in developed countries the economic value lost as a result of road accidents is about 1 to 2 percent of GDP. Hence accidents topic is very important in Iran. In this study we showed that high–traffic density intersections have larger externality, and increase in traffic density leads to increase in accident frequency. We chose and analyzed the number of accidents in 30 intersections over 24 month since 1389 to 1390 as dependent variable. This study estimated linear and quadratic models, to ordinary least squares (OLS) estimation with using panel data model. We found that high traffic density intersections have more accidents and large negative externality by using quadratic model. Also we found that the number of 3-vehicle accidents is decreased in high traffic intersections.