On the Definition and Age-Dependency of the Value of a Statistical Life. A Review and Extension
AbstractThe value of preventing a fatality or (saving) a statistical life is an important question in health economics as well as environmental economics. This paper reviews and adds new insights to several of the issues discussed in the literature. For example, how do we define the value of a (statistical) life? Are there really strong theoretical reasons for believing that the value of a life declines with age? The paper derives definitions of the value of a statistical life in both single-period models and life-cycle models. Models with and without actuarially fair annuities are examined, as well as the age-profile of the value of a statistical life.
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 Stockholm School of Economics in its series Working Paper Series in Economics and Finance with number 490.
Length: 32 pages
Date of creation: 25 Jan 2002
Date of revision: 29 Jan 2002
Contact details of provider:
Postal: The Economic Research Institute, Stockholm School of Economics, P.O. Box 6501, 113 83 Stockholm, Sweden
Phone: +46-(0)8-736 90 00
Fax: +46-(0)8-31 01 57
Web page: http://www.hhs.se/
More information through EDIRC
Value of a statistical life; value of preventing a fatality; age-specific values; willingness to pay;
Find related papers by JEL classification:
- C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
- D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
- I10 - Health, Education, and Welfare - - Health - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-02-10 (All new papers)
- NEP-HEA-2002-02-15 (Health Economics)
- NEP-IAS-2002-02-15 (Insurance Economics)
- NEP-MIC-2002-02-15 (Microeconomics)
- NEP-PKE-2002-02-15 (Post Keynesian 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.:
- Olivier J. Blanchard, 1984.
"Debt, Deficits and Finite Horizons,"
NBER Working Papers
1389, National Bureau of Economic Research, Inc.
- Blanchard, Olivier J, 1985. "Debt, Deficits, and Finite Horizons," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 93(2), pages 223-47, April.
- Donald S. Shepard & Richard J. Zeckhauser, 1984. "Survival versus Consumption," Management Science, INFORMS, INFORMS, vol. 30(4), pages 423-439, April.
- Leung, S.F., 1992.
"Uncertain Lifetime, the Theory of the Consumer, and the Life Cycle Hypothesis,"
RCER Working Papers
323, University of Rochester - Center for Economic Research (RCER).
- Leung, Siu Fai, 1994. "Uncertain Lifetime, the Theory of the Consumer, and the Life Cycle Hypothesis," Econometrica, Econometric Society, Econometric Society, vol. 62(5), pages 1233-39, September.
- Blomqvist, Ake, 2002. "Defining the value of a statistical life: a comment," Journal of Health Economics, Elsevier, Elsevier, vol. 21(1), pages 169-175, January.
- Jones-Lee, M W, 1991. " Altruism and the Value of Other People's Safety," Journal of Risk and Uncertainty, Springer, Springer, vol. 4(2), pages 213-19, April.
- Sherwin Rosen, .
"The Value of Changes in Life Expectancy,"
University of Chicago - Population Research Center, Chicago - Population Research Center
87-14, Chicago - Population Research Center.
- Meltzer, David, 1997. "Accounting for future costs in medical cost-effectiveness analysis," Journal of Health Economics, Elsevier, Elsevier, vol. 16(1), pages 33-64, February.
- Léonard,Daniel & Long,Ngo van, 1992.
"Optimal Control Theory and Static Optimization in Economics,"
Cambridge Books, Cambridge University Press,
Cambridge University Press, number 9780521331586.
- Léonard,Daniel & Long,Ngo van, 1992. "Optimal Control Theory and Static Optimization in Economics," Cambridge Books, Cambridge University Press, Cambridge University Press, number 9780521337465.
- Johansson, Per-Olov, 2001. "Is there a meaningful definition of the value of a statistical life?," Journal of Health Economics, Elsevier, Elsevier, vol. 20(1), pages 131-139, January.
- LaFrance, Jeffrey T. & Barney, L. Dwayne, 1991. "The envelope theorem in dynamic optimization," Journal of Economic Dynamics and Control, Elsevier, Elsevier, vol. 15(2), pages 355-385, April.
- Chang, Fwu-Ranq, 1991. "Uncertain Lifetimes, Retirement and Economic Welfare," Economica, London School of Economics and Political Science, London School of Economics and Political Science, vol. 58(230), pages 215-32, May.
- Caputo, Michael R., 1990. "How to do comparative dynamics on the back of an envelope in optimal control theory," Journal of Economic Dynamics and Control, Elsevier, Elsevier, vol. 14(3-4), pages 655-683, October.
- Arthur, W B, 1981. "The Economics of Risks to Life," American Economic Review, American Economic Association, American Economic Association, vol. 71(1), pages 54-64, March.
- Antoine Bommier & François Grand, 2014. "Too risk averse to purchase insurance?," Journal of Risk and Uncertainty, Springer, Springer, vol. 48(2), pages 135-166, April.
- Evans, Mary F. & Smith, V. Kerry, 2006. "Do we really understand the age-VSL relationship?," Resource and Energy Economics, Elsevier, Elsevier, vol. 28(3), pages 242-261, August.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Helena Lundin).
If references are entirely missing, you can add them using this form.