Scandinavian Working Papers in Economics

Working Papers,
Örebro University, School of Business

No 2006:6: The Value of a Statistical Life in Sweden Estimates from Two Studies using the "Certainty Approach" Calibration

Mikael Svensson ()
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Mikael Svensson: Department of Business, Economics, Statistics and Informatics, Postal: Örebro University, Department of Business, Economics, Statistics and Informatics, SE - 701 82 ÖREBRO, Sweden

Abstract: Stated preference methods using surveys to elicit willingness to pay have been shown to suffer from hypothetical bias and scope/scale bias. Hypothetical bias usually means that willingness to pay is exaggerated in the hypothetical scenario and scope/scale bias means that there is an insensitivity in willingness to pay with regard to the amount of goods or the size of a good being valued. Experimental results in social psychology and economics have shown that only trusting the most certain respondents can potentially solve the problem with hypothetical bias and scope/scale bias. This paper presents the results of two different surveys in Sweden estimating the willingness to pay to reduce traffic mortality risks by only including the most certain respondents. Using the full sample, estimates of VOSL are $4.2 and $7.3 million. Estimates of VOSL on the subset of the samples only including the most certain respondents are lower and consistent between the two surveys with values of $2.9 and $3.1 million.

Keywords: Value of a Statistical Life; Contingent Valuation; Hypothetical Bias; Calibration; Certainty Approach

JEL-codes: D80; I18; Q51

22 pages, First version: September 27, 2006. Revised: May 12, 2009. Earlier revisions: July 25, 2007, June 12, 2008.

Note: Published:Svensson, M., (2009), “The value of a statistical life in Sweden: Estimates from two studies using the “Certainty Approach” calibration”, Accident Analysis & Prevention, Vol 41(3): 430-437.

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Published as
Mikael Svensson, (2009), 'The value of a statistical life in Sweden: Estimates from two studies using the “Certainty Approach” calibration”, Accident Analysis & Prevention, Vol 41(3): 430-437.', Accident Analysis & Prevention, pages 430-437

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