After listening to this podcast with Don Boudreaux on Hayeks’ distinction between law and legislation, John Hoehn responded with this fascinating example of how Michigan lets speed limits emerge on certain roads:
Hayekians may be interested to know that, in Michigan, traffic speed limits on state and county roads are "discovered". Speed limits on the latter roads may be set initially based on engineering considerations and the general experience of county road commission personnel. However, if a member of the general public thinks the initial limit is too fast or too slow, he or she can request a "traffic study" by the county road commission. If the road commission hasn’t recently conducted such a study, it usually responds positively to the request–it sets up equipment on the section of road to measure the actual speeds of vehicles traveling on the road.
The purpose of the traffic study is to estimate the speed at which the 85th percentile of traffic speeds. If the 85th percentile matches the posted speed limit, the posted limit is affirmed. If the 85th percentile is different from the limit, a new speed limit is established that is as close to the 85th percentile as possible (though rounded to the nearest multiple of 5, I believe). That’s how speed limits are discovered in Michigan. The only caveat here is that the discovery approach only applies to speed limits under the statutory maximum of 55 mph to state and county roads. The state has a brochure that details of the discovery approach:
Of course, there are other types of highways for which speed limits are set by legislative bodies. Cities have the discretion to set statutory limits within their boundaries. State legislation sets residential and school zone limits to 35 mph. Freeway limits are also set by statute to 65 or 70 in most places. It’s all covered in the brochure on the state website.