Willingness to Accept Equals Willingness to Pay for Labor Market Estimates of the Value of Statistical Life
AbstractOur research clarifies the conceptual linkages among willingness to pay for additional safety, willingness to accept less safety, and the value of statistical life (VSL). We present econometric estimates that in the important case of workers' decisions concerning exposure to fatal injury risk there is no statistically significant divergence between willingness to accept and willingness to pay. Our focal result contrasts with the literature documenting a considerable asymmetry in tradeoff rates for increases and decreases in risk. An important implication for policy is that it is reasonable to use labor market estimates of VSL as a measure of the willingness to pay for additional safety.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6816.
Length: 30 pages
Date of creation: Aug 2012
Date of revision:
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Find related papers by JEL classification:
- C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
- I10 - Health, Education, and Welfare - - Health - - - General
- J17 - Labor and Demographic Economics - - Demographic Economics - - - Value of Life; Foregone Income
- J28 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Safety; Job Satisfaction; Related Public Policy
- K00 - Law and Economics - - General - - - General (including Data Sources and Description)
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