Dying in an Avalanche: Current Risks and Valuation
AbstractThis paper examines the influence of implicit information associated with the occurrence of avalanches on willingness to pay (WTP) values for a risk prevention of dying in an avalanche. We present results of a contingent valuation (CV) study carried out in Austria in two different periods (fall 2004 and winter 2005). The comparison of WTP results between the two waves allows the identification whether the immediate occurrence of avalanches and their attendant deathly accidents affect individual risk evaluations. Surprisingly, individuals state a lower WTP in winter although avalanche accidents are predominant at that time. Personal responsibility of risk exposure and its associated voluntariness are main reasons for the decrease in WTP over time. Preferences for alternative protective measures (e.g. against car accidents or food poisoning) also lead to a decrease of WTP while a higher risk perception and personal experience with avalanches show a positive influence. We conclude that the change in WTP across seasons is not arbitrary but can be explained by specific risk characteristics. It follows that WTP is more robust as previously assumed and therefore represents a proper measure for the elicitation of individual risk reduction preferences.
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Bibliographic InfoPaper provided by University of Adelaide, School of Economics in its series School of Economics Working Papers with number 2005-16.
Length: 32 pages
Date of creation: Nov 2005
Date of revision:
Contingent valuation; willingness to pay; risk prevention; risk perception;
Other versions of this item:
- Andrea M. Leiter & Gerald J. Pruckner, 2005. "Dying in an Avalanche: Current risks and Valuation," Game Theory and Information 0511009, EconWPA.
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
- J17 - Labor and Demographic Economics - - Demographic Economics - - - Value of Life; Foregone Income
- 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
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