Working Papers,
Swedish National Road & Transport Research Institute (VTI)

Abstract: Although the value of reducing mortality risks and that of reducing life year losses are closely related to each other, the valuation literature seems to treat them rather separately resulting in conflicting value estimates. While the former is more concerned with saved statistical lives from accidents, the latter is more directed to the lost life years due to air pollution etc. In this paper, we attempt to conduct an integrated valuation study for both types of values in the same choice experimental design.

We formulate an econometric model which simultaneously takes into account both mortality risk reduction and life year loss. The results indicates that conditional on given remaining life years upon survival, the marginal willingness to pay is constant for each statistical life saved, which indicates strong scope effect. The marginal value per extra life year, however, is a diminishing function of the number of life years. We have also examined the effect of other covariates such as the respondents’ characteristics (e.g. gender and age), their self-confidence in making choices, and possible categorical behavior on the final value estimates.

Keywords: value of statistical life; value of life years; stated preference; choice experiment

JEL-codes: I18

19 pages, November 11, 2010

Full text files

VLS_VOLY_101030_Nerhagen_Li_2.pdf  

Download statistics

• Swedish National Road & Transport Research Institute (VTI)
• See also CTS Working papers in Transport Economics
• Ordering Working Papers
• Home page for this series

Questions (including download problems) about the papers in this series should be directed to Biblioteket vid VTI ()
Report other problems with accessing this service to Sune Karlsson ().

RePEc:hhs:vtiwps:2010_011This page generated on 2024-09-13 22:17:40.