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The value of life and its regional difference in China

Author

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  • Xuezheng Qin
  • Lixing Li
  • Yangyang Liu

Abstract

Purpose - The purpose of this paper is to estimate the value of a statistical life (VSL) in China using the hedonic wage model, and to explore the regional difference in VSL within the country. Design/methodology/approach - Using the hedonic wage regression, this paper estimates the compensating wage differential for incremental job mortality risk among Chinese workers. The implied VSL is derived for China and its different regions. The data is from the 2005 China inter‐census population survey, consisting of 1.3 million urban and rural workers. The authors also made important improvement in the model specification to explicitly address the missing variable issue in the previous studies. Findings - The paper results indicate that the industry mortality risk has a significant impact on the wage rate. The implied VSL is 1.81 million RMB, a value substantially higher than previous estimates. The results also suggest a sizable urban‐rural difference, with the urban VSL being 4.3 times higher than the rural estimate. The strong urban‐rural inequality of income could be attributed to the segregation between the urban and rural labor markets. Practical implications - The paper findings indicate the importance of reforming the current workers' compensation standard and improving the institutional environment, as well as enhancing the labor protection in the rural labor market. Originality/value - This paper is the first attempt to estimate the value of life in China using the census based data. The paper results contribute to the growing literature in obtaining comparable VSL estimates in the developing countries.

Suggested Citation

  • Xuezheng Qin & Lixing Li & Yangyang Liu, 2013. "The value of life and its regional difference in China," China Agricultural Economic Review, Emerald Group Publishing Limited, vol. 5(3), pages 373-390, August.
    • Handle: RePEc:eme:caerpp:v:5:y:2013:i:3:p:373-390
    DOI: 10.1108/CAER-06-2011-0065
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    Citations

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    Cited by:

    1. He, Guojun & Fan, Maoyong & Zhou, Maigeng, 2016. "The effect of air pollution on mortality in China: Evidence from the 2008 Beijing Olympic Games," Journal of Environmental Economics and Management, Elsevier, vol. 79(C), pages 18-39.
    2. Fan, Maoyong & He, Guojun & Zhou, Maigeng, 2020. "The winter choke: Coal-Fired heating, air pollution, and mortality in China," Journal of Health Economics, Elsevier, vol. 71(C).
    3. Avraham Ebenstein & Maoyong Fan & Michael Greenstone & Guojun He & Peng Yin & Maigeng Zhou, 2015. "Growth, Pollution, and Life Expectancy: China from 1991-2012," American Economic Review, American Economic Association, vol. 105(5), pages 226-231, May.
    4. Anthony Boardman & Jeff Geng & Bruno Lam, 2020. "The Social Cost of Informal Electronic Waste Processing in Southern China," Administrative Sciences, MDPI, vol. 10(1), pages 1-20, February.
    5. Xu Kuang & Fuquan Zhao & Han Hao & Zongwei Liu, 2019. "Assessing the Socioeconomic Impacts of Intelligent Connected Vehicles in China: A Cost–Benefit Analysis," Sustainability, MDPI, vol. 11(12), pages 1-28, June.

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