Scale, Scope and Cognition: Context Analysis of Multiple Stated Choice Experiments on the Values of Life and Limb
AbstractIn this paper we use data from an SP study on flood safety in the Netherlands, and elicit individual preferences for reduction of risk to life and limb. We perform context analysis to test the robustness of fatality risk valuation throughout choice experiments. The main interest of this paper is VOSL sensitivity to the valuation of correlated risks (scope effect). Besides, we explore the role of cognition on the stability of valuation across choice experiments using age and education. We pool data from multiple choice experiments and apply nested and mixed logit models in our analysis. We confirm statistically significant sensitivity to scope, comparing VOSL estimates for the test group in a choice experiment where correlated risks were present (risks of fatality, injury and evacuation) to an experiment where only fatality risk is valued. We find that the origin of differences in VOSL valuations across the choice experiments lies in differences in age and educational attainment, and may therefore be related to cognitive abilities of respondents. In particular, we conclude that higher VOSL sensitivity to scope is most prominently present among respondents of senior age (65 and older) and respondents without college education. This finding has important implications for discrete choice modeling and the use of obtained values in cost-benefit analyses.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 12-046/3.
Date of creation: 26 Apr 2012
Date of revision:
Contact details of provider:
Web page: http://www.tinbergen.nl
stated preferences; value of statistical life; value of statistical injury; value of statistical evacuation; flood risk;
Find related papers by JEL classification:
- C01 - Mathematical and Quantitative Methods - - General - - - Econometrics
- C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
- C83 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Survey Methods; Sampling Methods
- C90 - Mathematical and Quantitative Methods - - Design of Experiments - - - General
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
- D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
- 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
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-08-23 (All new papers)
- NEP-DCM-2012-08-23 (Discrete Choice Models)
- NEP-EXP-2012-08-23 (Experimental Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- W. Kip Viscusi & Joseph E. Aldy, 2003.
"The Value of a Statistical Life: A Critical Review of Market Estimates throughout the World,"
NBER Working Papers
9487, National Bureau of Economic Research, Inc.
- Viscusi, W Kip & Aldy, Joseph E, 2003. " The Value of a Statistical Life: A Critical Review of Market Estimates throughout the World," Journal of Risk and Uncertainty, Springer, vol. 27(1), pages 5-76, August.
- Aldy, Joseph E. & Viscusi, W. Kip, 2003. "The Value of Statistical Life: A Critical Review of Market Estimates throughout the World," Working paper 282, Regulation2point0.
- Anna Alberini & Alistair Hunt & Anil Markandya, 2004.
"Willingness to Pay to Reduce Mortality Risks: Evidence from a Three-Country Contingent Valuation Study,"
2004.111, Fondazione Eni Enrico Mattei.
- Anna Alberini & Alistair Hunt & Anil Markandya, 2006. "Willingness to Pay to Reduce Mortality Risks: Evidence from a Three-Country Contingent Valuation Study," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 33(2), pages 251-264, 02.
- Bellavance, Franois & Dionne, Georges & Lebeau, Martin, 2009.
"The value of a statistical life: A meta-analysis with a mixed effects regression model,"
Journal of Health Economics,
Elsevier, vol. 28(2), pages 444-464, March.
- François Bellavance & Georges Dionne & Martin Lebeau, 2006. "The Value of a Statistical Life: a Meta-Analysis with a Mixed Effects Regression Model," Cahiers de recherche 0646, CIRPEE.
- Scarpa, Riccardo & Thiene, Mara & Hensher, David A., 2009.
"Monitoring Choice Task Attribute Attendance In Non-Market Valuation Of Multiple Park Management Services: Does It Matter?,"
2009 Conference, August 16-22, 2009, Beijing, China
50830, International Association of Agricultural Economists.
- Riccardo Scarpa & Mara Thiene & David A. Hensher, 2010. "Monitoring Choice Task Attribute Attendance in Nonmarket Valuation of Multiple Park Management Services: Does It Matter?," Land Economics, University of Wisconsin Press, vol. 86(4), pages 817-839.
- Johannesson, Magnus & Johansson, Per-Olov & O'Conor, Richard M, 1996.
"The Value of Private Safety versus the Value of Public Safety,"
Journal of Risk and Uncertainty,
Springer, vol. 13(3), pages 263-75, November.
- Johannesson, Magnus & Johansson, Per-Olov & O'Conor, Richard M., 1996. "The Value of Private Safety versus the Value of Public Safety," Working Paper Series in Economics and Finance 103, Stockholm School of Economics.
- Alan Krupnick, 2007. "Mortality-risk Valuation and Age: Stated Preference Evidence," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 1(2), pages 261-282, Summer.
- K. Shanmugam, 2000. "Valuations of Life and Injury Risks," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 16(4), pages 379-389, August.
- de Palma, Andre & Myers, Gordon M & Papageorgiou, Yorgos Y, 1994. "Rational Choice under an Imperfect Ability to Choose," American Economic Review, American Economic Association, vol. 84(3), pages 419-40, June.
- Kahneman, Daniel & Knetsch, Jack L., 1992. "Valuing public goods: The purchase of moral satisfaction," Journal of Environmental Economics and Management, Elsevier, vol. 22(1), pages 57-70, January.
- Jin, Jianjun & Indab, Anabeth & Nabangchang, Orapan & Thuy, Truong Dang & Harder, Dieldre & Subade, Rodelio F., 2010. "Valuing marine turtle conservation: A cross-country study in Asian cities," Ecological Economics, Elsevier, vol. 69(10), pages 2020-2026, August.
- Andrea Leiter & Gerald Pruckner, 2009.
"Proportionality of Willingness to Pay to Small Changes in Risk: The Impact of Attitudinal Factors in Scope Tests,"
Environmental & Resource Economics,
European Association of Environmental and Resource Economists, vol. 42(2), pages 169-186, February.
- Andrea M. Leiter & Gerald J. Pruckner, . "Proportionality of willingness to pay to small changes in risk - The impact of attitudinal factors in scope tests," Working Papers 2007-30, Faculty of Economics and Statistics, University of Innsbruck.
- Burge, Peter & Netten, Ann & Gallo, Federico, 2010. "Estimating the value of social care," Journal of Health Economics, Elsevier, vol. 29(6), pages 883-894, December.
- Richard Carson & Theodore Groves, 2007.
"Incentive and informational properties of preference questions,"
Environmental & Resource Economics,
European Association of Environmental and Resource Economists, vol. 37(1), pages 181-210, May.
- Carson, Richard T & Groves, Theodore, 2010. "Incentive and Information Properties of Preference Questions," University of California at San Diego, Economics Working Paper Series qt88d8644g, Department of Economics, UC San Diego.
- F. Johnson, 2006. "Comment on “Revealing Differences in Willingness to Pay Due to the Dimensionality of Stated Choice Designs: An Initial Assessment”," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 34(1), pages 45-50, 05.
- O'Conor, Richard M. & Blomquist, Glenn C., 1997. "Measurement of consumer-patient preferences using a hybrid contingent valuation method," Journal of Health Economics, Elsevier, vol. 16(6), pages 667-683, December.
- Marija Bockarjova & Piet Rietveld & Erik T. Verhoef, 2012. "Composite Valuation of Immaterial Damage in Flooding: Value of Statistical Life, Value of Statistical Evacuation and Value of Statistical Injury," Tinbergen Institute Discussion Papers 12-047/3, Tinbergen Institute.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Antoine Maartens (+31 626 - 160 892)).
If references are entirely missing, you can add them using this form.