Abstract: To explore the relationship between traffic accidents and the macroeconomic factors,the authors collects historical data from seven counties from 1963 to 2005 to analyze the principle of traffic accidents.Panel data model is selected to measure the impacts of various factors after comparison because of its advantages of combinating time series models and cross section models.Fixed-effects model and random effects model are used to estimate accidents respectively.Husman tests are used to decide which model is to choose.Results show that the fixed effect model well describes accidents and 100 000 population fatality rates,and other economic indicators.The discussion shows that as the economic development,China's current GDP and vehicles ownership keep growing in a few years and 100 000 population fatality rates continue to increase.