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A double-bounded risk-risk trade-off analysis of heatwave-related mortality risk: Evidence from India

Author

Listed:
  • Susan Chilton

    (Newcastle University Business School (Economics))

  • Darren Duxbury

    (Newcastle University Business School (Accounting and Finance))

  • Irene Mussio

    (Leeds University Business School, Department of Economics, Lyddon Terrace)

  • Jytte Seested Nielsen

    (Newcastle University Business School (Economics))

  • Smriti Sharma

    (Newcastle University Business School (Economics)
    IZA & GLO)

Abstract

As climate variability is increasing, extreme events such as temperature fluctuations are expected to become more frequent. Low- and middle-income countries (LMICs) are especially vulnerable to heat-related variability and its ensuing impacts on mortality. Therefore, there is an urgent need to understand how citizens in LMICs trade-off climate-related mortality risks with other risks such as traffic accidents, and what values they place on reducing such risks. As populations in LMICs are income-constrained, we adopt a non-monetary, risk-risk trade-off (RRTO) valuation method instead of the standard willingness-to-pay stated preference-based approach. We estimate the resulting risk premium for heatwave-related mortality risks through an adapted double-bounded, dichotomous choice approach to establish whether, on average, people value avoiding these risks more compared to reducing traffic risks. Using a sample of over 2,300 individuals from across seven states in India, a country with one of the highest heat-related mortality globally, we estimate the heatwave risk mortality premium to be between 2.2–2.9, indicating that on average, individuals weigh reducing heatwave-related mortality risks more than two times that of reducing traffic accident mortality risks. Based on a standard benefit transfer methodology for LMICs, this premium translates to a Value of Statistical Life (VSL) of USD 0.37–2.61 million for India.

Suggested Citation

  • Susan Chilton & Darren Duxbury & Irene Mussio & Jytte Seested Nielsen & Smriti Sharma, 2024. "A double-bounded risk-risk trade-off analysis of heatwave-related mortality risk: Evidence from India," Journal of Risk and Uncertainty, Springer, vol. 68(1), pages 1-23, February.
    • Handle: RePEc:kap:jrisku:v:68:y:2024:i:1:d:10.1007_s11166-023-09422-2
    DOI: 10.1007/s11166-023-09422-2
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    More about this item

    Keywords

    Climate change; Heatwaves; Context premium; Risk-risk trade-off; Value of statistical life; India;
    All these keywords.

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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