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Paying for Permanence: Public Preferences for Contaminated Site Cleanup

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Author Info

  • Anna Alberini

    (University of Maryland)

  • Stefania Tonin

    (University of Venice-IUAV)

  • Margherita Turvani

    (University of Venice-IUAV)

  • Aline Chiabai

    (Fondazione Eni Enrico Mattei)

Abstract

We use conjoint choice questions to investigate people’s preferences for income and reductions in mortality risks delivered by contaminated site remediation policies. Our survey is self-administered using the computer by residents of four cities in Italy with severely contaminated sites. We estimate the Value of a Statistical Life to be about €5.6 million for an immediate risk reduction. If the risk reduction takes place 20 years from now, however, the implied VSL is about €1.26 million. The discount rate implicit in the responses to the conjoint choice questions is about 7%. People are willing to pay for permanent risk reductions, but not just any amount. Risk reductions in the nearer future are valued more highly than risk reductions in the more distant future. We also find that the VSL is “individuated,” in the sense that it depends on observable individual characteristics of the respondents, familiarity with contaminated sites, concern about the health effects of exposure to toxicants, having a family member with cancer, perceived usefulness of possible government actions, and the respondent’s beliefs about the goals of government remediation programs. Additional questions suggest that respondents discount lives, and do so at a discount rate in the ballpark of that implicit in their risk v. money tradeoffs.

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Bibliographic Info

Paper provided by Fondazione Eni Enrico Mattei in its series Working Papers with number 2006.113.

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Date of creation: Sep 2006
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Handle: RePEc:fem:femwpa:2006.113

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Related research

Keywords: Value of a Statistical Life; Latent Risk Reductions; Individual Discount Rates; Conjoint Choice Questions; Contaminated Sites; Remediation;

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References

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  1. Ted Gayer & James T. Hamilton & W. Kip Viscusi, 2002. "The Market Value of Reducing Cancer Risk: Hedonic Housing Prices with Changing Information," Southern Economic Journal, Southern Economic Association, vol. 69(2), pages 266-289, October.
  2. Jin-Tan Liu & James K. Hammitt, 2003. "Effects of Disease Type and Latency on the Value of Mortality Risk," NBER Working Papers 10012, National Bureau of Economic Research, Inc.
  3. Anna Alberini & Aline Chiabai & Margherita Turvani & Stefania Tonin, 2006. "Public Support for Policies Addressing Contaminated Sites: Evidence From a Survey of the Italian Public," ERSA conference papers ersa06p651, European Regional Science Association.
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  5. Anna Alberini & Stefania Tonin & Margherita Turvani & Aline Chiabai, 2007. "Paying for permanence: Public preferences for contaminated site cleanup," Journal of Risk and Uncertainty, Springer, vol. 34(2), pages 155-178, April.
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Citations

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Cited by:
  1. Anna Alberini & Stefania Tonin & Margherita Turvani, 2009. "The Value of Reducing Cancer Risks at Contaminated Sites: Are More Heavily Exposed People Willing to Pay More?," Working Papers 2009.60, Fondazione Eni Enrico Mattei.
  2. Mary Riddel, 2012. "Comparing risk preferences over financial and environmental lotteries," Journal of Risk and Uncertainty, Springer, vol. 45(2), pages 135-157, October.
  3. Thijs Dekker & Roy Brouwer & Marjan Hofkes & Klaus Moeltner, 2011. "The Effect of Risk Context on the Value of a Statistical Life: a Bayesian Meta-model," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 49(4), pages 597-624, August.
  4. Botzen, W.J.W. & van den Bergh, J.C.J.M., 2012. "Risk attitudes to low-probability climate change risks: WTP for flood insurance," Journal of Economic Behavior & Organization, Elsevier, vol. 82(1), pages 151-166.
  5. Anna Alberini & Aline Chiabai & Margherita Turvani & Stefania Tonin, 2006. "Public Support for Policies Addressing Contaminated Sites: Evidence From a Survey of the Italian Public," ERSA conference papers ersa06p651, European Regional Science Association.
  6. Veronesi, Marcella & Chawla, Fabienne & Maurer, Max & Lienert, Judit, 2014. "Climate change and the willingness to pay to reduce ecological and health risks from wastewater flooding in urban centers and the environment," Ecological Economics, Elsevier, vol. 98(C), pages 1-10.
  7. Christoph Rheinberger, 2011. "A Mixed Logit Approach to Study Preferences for Safety on Alpine Roads," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 49(1), pages 121-146, May.
  8. Anna Alberini & Margherita Turvani & Aline Chiabai & Stefania Tonin, 2007. "Public Policies for Contaminated Site Cleanup: The Opinions of the Italian Public," Working Papers 2007.11, Fondazione Eni Enrico Mattei.
  9. Henrik Andersson & Arne Risa Hole & Mikael Svensson, 2014. "Valuation of Small and Multiple Health Risks: A Critical Analysis of SP Data Applied to Food and Water Safety," Working Papers 2014005, The University of Sheffield, Department of Economics.
  10. Anna Alberini & Stefania Tonin & Margherita Turvani & Aline Chiabai, 2006. "Paying for Permanence: Public Preferences for Contaminated Site Cleanup," Working Papers 2006.113, Fondazione Eni Enrico Mattei.
  11. Carlsson, Fredrik & Daruvala, Dinky & Jaldell, Henrik, 2008. "Value of statistical life and cause of accident: A choice experiment," Working Papers in Economics 332, University of Gothenburg, Department of Economics.
  12. Anna Alberini & Milan Ščasný, 2011. "Context and the VSL: Evidence from a Stated Preference Study in Italy and the Czech Republic," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 49(4), pages 511-538, August.
  13. Alberini, Anna & Ščasný, Milan, 2013. "Exploring heterogeneity in the value of a statistical life: Cause of death v. risk perceptions," Ecological Economics, Elsevier, vol. 94(C), pages 143-155.
  14. Dennis Guignet & Anna Alberini, 2013. "Can Property Values Capture Changes in Environmental Health Risks? Evidence from a Stated Preference Study in Italy and the UK," Working Papers 2013.67, Fondazione Eni Enrico Mattei.

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