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New Estimates of the Value of a Statistical Life Using Air Bag Regulations as a Quasi-experiment

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  • Chris Rohlfs
  • Ryan Sullivan
  • Thomas Kniesner

Abstract

Due to federal regulations, automobile air bag availability was a model-specific discontinuous function of model year for used vehicles in the 1990s and early 2000s. We use the discontinuities and the gradual increase in the supply of air bags to trace out the demand curve for air bags and the implied distribution of the Value of a Statistical Life (VSL) across consumers. Although imprecise, our preferred point estimates indicate that the median VSL is between $9 million and $11 million and that a sizable portion of consumers placed negative values on air bags, probably due to distrust of the technology. (JEL D12, J17, L51, L62)

Suggested Citation

  • Chris Rohlfs & Ryan Sullivan & Thomas Kniesner, 2015. "New Estimates of the Value of a Statistical Life Using Air Bag Regulations as a Quasi-experiment," American Economic Journal: Economic Policy, American Economic Association, vol. 7(1), pages 331-359, February.
  • Handle: RePEc:aea:aejpol:v:7:y:2015:i:1:p:331-59
    Note: DOI: 10.1257/pol.20110309
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Thomas J. Kniesner, 2019. "Behavioral economics and the value of a statistical life," Journal of Risk and Uncertainty, Springer, vol. 58(2), pages 207-217, June.
    2. Hui He & Kevin X.D. Huang & Lei Ning, 2021. "Why Do Americans Spend So Much More On Health Care Than Europeans?," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 62(4), pages 1363-1399, November.
    3. Rohlfs, Chris & Sullivan, Ryan & Kniesner, Thomas J., 2013. "Hedonic Estimation under Very General Conditions Using Experimental and Quasi-Experimental Designs," IZA Discussion Papers 7554, Institute of Labor Economics (IZA).
    4. Ian Martin & Robert S. Pindyck, 2017. "Averting Catastrophes that Kill," NBER Working Papers 23346, National Bureau of Economic Research, Inc.
    5. Akbar Marvasti, 2020. "Value Of Life And Injury: Evidence From A U.S. Fishery," Contemporary Economic Policy, Western Economic Association International, vol. 38(4), pages 711-722, October.
    6. Joni Hersch, 2018. "Valuing the risk of workplace sexual harassment," Journal of Risk and Uncertainty, Springer, vol. 57(2), pages 111-131, October.
    7. Chris Rohlfs & Ryan Sullivan & Thomas Kniesner, 2015. "New Estimates of the Value of a Statistical Life Using Air Bag Regulations as a Quasi-experiment," American Economic Journal: Economic Policy, American Economic Association, vol. 7(1), pages 331-359, February.
    8. James O’Brien, 2018. "Age, autos, and the value of a statistical life," Journal of Risk and Uncertainty, Springer, vol. 57(1), pages 51-79, August.
    9. Hui He & Kevin x.d. Huang & Lei Ning, 2019. "Why Do Americans Spend So Much More on Health Care than Europeans? (REVISED)," Vanderbilt University Department of Economics Working Papers 19-00008, Vanderbilt University Department of Economics.
    10. Hui He & Kevin X.D. Huang & Lei Ning, 2019. "Why Do Americans Spend So Much More on Health Care than Europeans? (REVISED)," Vanderbilt University Department of Economics Working Papers 19-00008, Vanderbilt University Department of Economics.
    11. Ian W R Martin & Robert S Pindyck, 2021. "Welfare Costs of Catastrophes: Lost Consumption and Lost Lives," Economic Journal, Royal Economic Society, vol. 131(634), pages 946-969.
    12. Eriksen, Michael D. & Kniesner, Thomas J. & Rohlfs, Chris & Sullivan, Ryan, 2016. "Toward more general hedonic estimation: Clarifying the roles of alternative experimental designs with an application to a housing attribute," Regional Science and Urban Economics, Elsevier, vol. 57(C), pages 54-62.
    13. Armey, Laura & Kniesner, Thomas J. & Leeth, John D. & Sullivan, Ryan, 2018. "Combat, Casualties, and Compensation: Evidence from Iraq and Afghanistan," IZA Discussion Papers 11785, Institute of Labor Economics (IZA).

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    More about this item

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • J17 - Labor and Demographic Economics - - Demographic Economics - - - Value of Life; Foregone Income
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L62 - Industrial Organization - - Industry Studies: Manufacturing - - - Automobiles; Other Transportation Equipment; Related Parts and Equipment

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