IDEAS home Printed from https://ideas.repec.org/p/lea/leawpi/0301.html
   My bibliography  Save this paper

Valuing life under the shadow of death : on stationary lifetime preferences under uncertainty

Author

Abstract

This paper develops an axiomatic construction of preferences that allows to compare lotteries involving lives of different lengths. Our axioms which basically formalize two assumptions - individuals are rational and have stationary preferences - leads to a class of utility functions that is much larger than the set of separable additive utility functions. We discuss a number of appealing properties associated with non additive utility functions and explore the implications for life cycle behavior. The results lead to a fundamental shift in how the risk of death may be expected to affect intertemporal choices. In particular, the rate of time discounting is shown to be related to mortality and to the way life is valued. This explains why "impatience" may significantly vary along the life cycle as well as why it may change with time during periods of mortality decline. Reciprocally, information on the value of life can also be derived from the variation of the rate of time discounting.

Suggested Citation

  • Antoine Bommier, 2002. "Valuing life under the shadow of death : on stationary lifetime preferences under uncertainty," Research Unit Working Papers 0301, Laboratoire d'Economie Appliquee, INRA.
    • Handle: RePEc:lea:leawpi:0301
    as

    Download full text from publisher

    File URL: http://www.inra.fr/Internet/Departements/ESR/UR/lea/documents/wp/wp0301.pdf
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    Value of life; Intertemporal choice; life cycle models;
    All these keywords.

    JEL classification:

    • J17 - Labor and Demographic Economics - - Demographic Economics - - - Value of Life; Foregone Income
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:lea:leawpi:0301. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Madeleine Roux (email available below). General contact details of provider: http://www.inra.fr/Internet/Departements/ESR/UR/lea/index.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.