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The Value Of Risk - Free Cigarettes - Do Smokers Underestimate The Risk?

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Author Info
Hammar, Henrik (Department of Economics, School of Economics and Commercial Law, Göteborg University)
Johansson-Stenman, Olof (Department of Economics, School of Economics and Commercial Law, Göteborg University)

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Abstract

The health risk of smoking is valued using the contingent valuation method, applied to a Swedish sample of smokers. The respondents were asked to put a value on newly developed cigarettes with no associated health risks. The average additional willingness to pay for the new cigarettes is estimated to be between10 and 41 SEK per packet. Using medical data on life shortening effects of smoking, the results indicate fairly reasonable values put on a lost life year, compared to existing estimates based on other methods. However, there are remaining methodological questions and we found little sensitivity to scope.

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File URL: http://hdl.handle.net/2077/2854
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Publisher Info
Paper provided by Göteborg University, Department of Economics in its series Working Papers in Economics with number 61.

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Length: 18 pages
Date of creation: 30 Nov 2001
Date of revision:
Publication status: Published in Health Economics, 2004, pages 59-71.
Handle: RePEc:hhs:gunwpe:0061

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Postal: Department of Economics, School of Business, Economics and Law, Göteborg University Box 640, SE 405 30 GÖTEBORG, Sweden
Phone: 031-773 10 00
Web page: http://www.handels.gu.se/econ/
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Related research
Keywords: cigarette consumption; value of life year; contingent valuation;

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Find related papers by JEL classification:
I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
J17 - Labor and Demographic Economics - - Demographic Economics - - - Value of Life; Foregone Income

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References listed on IDEAS
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.:
  1. Corso, Phaedra S & Hammitt, James K & Graham, John D, 2001. " Valuing Mortality-Risk Reduction: Using Visual Aids to Improve the Validity of Contingent Valuation," Journal of Risk and Uncertainty, Springer, vol. 23(2), pages 165-84, September. [Downloadable!] (restricted)
  2. Krupnick, Alan & Cropper, Maureen & Alberini, Anna & Simon, Nathalie & Itaoka, Kenshi & Akai, Makoto, 1999. "Mortality Risk Valuation for Environmental Policy," Discussion Papers dp-99-47, Resources For the Future. [Downloadable!]
  3. Hammitt, James K & Graham, John D, 1999. "Willingness to Pay for Health Protection: Inadequate Sensitivity to Probability?," Journal of Risk and Uncertainty, Springer, vol. 18(1), pages 33-62, April. [Downloadable!] (restricted)
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    Other versions:
  21. Ippolito, Pauline M. & Ippolito, Richard A., 1984. "Measuring the value of life saving from consumer reactions to new information," Journal of Public Economics, Elsevier, vol. 25(1-2), pages 53-81, November. [Downloadable!] (restricted)
Full references

Cited by:
(explanations, 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.)

  1. Rosalina Palanca Tan, 2008. "The Valur of Mortality Risk Reduction for Children in Metro Manila, Inferred from Parent's Willingness to Pay for Dengue Vaccines," EEPSEA Research Report rr2008081, Economy and Environment Program for Southeast Asia (EEPSEA), revised Aug 2008. [Downloadable!]
  2. 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. [Downloadable!] (restricted)
    Other versions:
  3. Andersson, Henrik & Svensson, Mikael, 2007. "Cognitive Ability and Scale Bias in the Contingent Valuation Method," Working Papers 2007:1, Swedish National Road & Transport Research Institute (VTI). [Downloadable!]
    Other versions:
  4. David Whynes & Emma Frew & Jane Wolstenholme, 2005. "Willingness-to-Pay and Demand Curves: A Comparison of Results Obtained Using Different Elicitation Formats," International Journal of Health Care Finance and Economics, Springer, vol. 5(4), pages 369-386, December. [Downloadable!] (restricted)
  5. Minhaj Mahmud, 2006. "Contingent Valuation of Mortality Risk Reduction in Developing Countries: A Mission Impossible?," Keele Economics Research Papers KERP 2006/01, Centre for Economic Research, Keele University. [Downloadable!]
    Other versions:
  6. Andersson, Henrik & Svensson, Mikael, 2006. "Cognitive Ability and Scale Bias in the Contingent Valuation Method," Working Papers 2006:2, Swedish National Road & Transport Research Institute (VTI).
  7. David L. Weimer & Aidan R. Vining & Randall K. Thomas, 2009. "Cost-benefit analysis involving addictive goods: contingent valuation to estimate willingness-to-pay for smoking cessation," Health Economics, John Wiley & Sons, Ltd., vol. 18(2), pages 181-202. [Downloadable!]
  8. Andrea M. Leiter & Gerald J. Pruckner, 2006. "Proportionality of Willingness to Pay to Small Risk Changes – The Impact of Attitudinal Factors in Scope Tests," Working Papers 2006.90, Fondazione Eni Enrico Mattei. [Downloadable!]
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