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

  • Rohlfs, Chris

    ()

    (Morgan Stanley)

  • Sullivan, Ryan

    ()

    (Naval Postgraduate School)

  • Kniesner, Thomas J.

    ()

    (Syracuse University)

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 these 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. While imprecise, our preferred point estimates indicate that the median VSL is between $7 million and $13 million, but that a sizable portion of consumers placed negative values on air bags, probably due to distrust of the technology.

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File URL: http://ftp.iza.org/dp6994.pdf
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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6994.

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Length: 60 pages
Date of creation: Nov 2012
Date of revision:
Publication status: published in: American Economic Journal: Economic Policy, 2015, 7 (1), 331-354
Handle: RePEc:iza:izadps:dp6994
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  1. Thomas J. Kniesner & W. Kip Viscusi & Christopher Woock & James P. Ziliak, 2012. "The Value of a Statistical Life: Evidence from Panel Data," The Review of Economics and Statistics, MIT Press, vol. 94(1), pages 74-87, February.
  2. Dan A. Black & Thomas J. Kniesner, 2003. "On the Measurement of Job Risk in Hedonic Wage Models," Center for Policy Research Working Papers 49, Center for Policy Research, Maxwell School, Syracuse University.
  3. repec:reg:rpubli:282 is not listed on IDEAS
  4. Ashenfelter, Orley, 2006. "Measuring the Value of a Statistical Life: Problems and Prospects," IZA Discussion Papers 1911, Institute for the Study of Labor (IZA).
  5. Janusz R. Mrozek & Laura O. Taylor, 2002. "What determines the value of life? a meta-analysis," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 21(2), pages 253-270.
  6. Joseph E. Aldy & W. Kip Viscusi, 2007. "Age Differences in the Value of Statistical Life: Revealed Preference Evidence," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 1(2), pages 241-260, Summer.
  7. Orley Ashenfelter & Michael Greenstone, 2002. "Using Mandated Speed Limits to Measure the Value of a Statistical Life," NBER Working Papers 9094, National Bureau of Economic Research, Inc.
  8. Viscusi, W Kip, 2003. " Racial Differences in Labor Market Values of a Statistical Life," Journal of Risk and Uncertainty, Springer, vol. 27(3), pages 239-56, December.
  9. Atkinson, Scott E & Halvorsen, Robert, 1990. "The Valuation of Risks to Life: Evidence from the Market for Automobiles," The Review of Economics and Statistics, MIT Press, vol. 72(1), pages 133-36, February.
  10. 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.
  11. James M. Sallee, 2011. "The Surprising Incidence of Tax Credits for the Toyota Prius," American Economic Journal: Economic Policy, American Economic Association, vol. 3(2), pages 189-219, May.
  12. Bartik, Timothy J, 1987. "The Estimation of Demand Parameters in Hedonic Price Models," Journal of Political Economy, University of Chicago Press, vol. 95(1), pages 81-88, February.
  13. Viscusi, W Kip & Aldy, Joseph E, 2003. " The Value of a Statistical Life: A Critical Review of Market Estimates throughout the World," Journal of Risk and Uncertainty, Springer, vol. 27(1), pages 5-76, August.
  14. Beat Hintermann & Anna Alberini & Anil Markandya, 2010. "Estimating the value of safety with labour market data: are the results trustworthy?," Applied Economics, Taylor & Francis Journals, vol. 42(9), pages 1085-1100.
  15. Dora L. Costa & Matthew E. Kahn, 2004. "Changes in the Value of Life, 1940--1980," Journal of Risk and Uncertainty, Springer, vol. 29(2), pages 159-180, 09.
  16. Orley Ashenfelter & Michael Greenstone, 2004. "Estimating the Value of a Statistical Life: The Importance of Omitted Variables and Publication Bias," Working Papers 858, Princeton University, Department of Economics, Industrial Relations Section..
  17. 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 331-59, February.
  18. Georges Dionne & Paul Lanoie, 2004. "Public Choice about the Value of a Statistical Life for Cost-Benefit Analyses: The Case of Road Safety," Journal of Transport Economics and Policy, London School of Economics and University of Bath, vol. 38(2), pages 247-274, May.
  19. Ashenfelter, Orley & Greenstone, Michael, 2004. "Estimating the Value of a Statistical Life: The Importance of Omitted Variables and Publication Bias," IZA Discussion Papers 1037, Institute for the Study of Labor (IZA).
  20. W. Kip Viscusi, 1996. "Economic Foundations of the Current Regulatory Reform Efforts," Journal of Economic Perspectives, American Economic Association, vol. 10(3), pages 119-134, Summer.
  21. Kurt E. Schnier & William C. Horrace & Ronald G. Felthoven, 2009. "The Value of Statistical Life: Pursuing the Deadliest Catch," Center for Policy Research Working Papers 117, Center for Policy Research, Maxwell School, Syracuse University.
  22. V. Kerry Smith & Mary F. Evans & Hyun Kim & Donald H. Taylor, 2004. "Do the Near-Elderly Value Mortality Risks Differently?," The Review of Economics and Statistics, MIT Press, vol. 86(1), pages 423-429, February.
  23. Dreyfus, Mark K & Viscusi, W Kip, 1995. "Rates of Time Preference and Consumer Valuations of Automobile Safety and Fuel Efficiency," Journal of Law and Economics, University of Chicago Press, vol. 38(1), pages 79-105, April.
  24. 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 for the Study of Labor (IZA).
  25. Kip Viscusi, W. & Aldy, Joseph E., 2007. "Labor market estimates of the senior discount for the value of statistical life," Journal of Environmental Economics and Management, Elsevier, vol. 53(3), pages 377-392, May.
  26. Viscusi, W Kip, 1993. "The Value of Risks to Life and Health," Journal of Economic Literature, American Economic Association, vol. 31(4), pages 1912-46, December.
  27. Rohlfs Chris, 2012. "The Economic Cost of Conscription and an Upper Bound on the Value of a Statistical Life: Hedonic Estimates from Two Margins of Response to the Vietnam Draft," Journal of Benefit-Cost Analysis, De Gruyter, vol. 3(3), pages 1-37, August.
  28. Leeth, John D & Ruser, John, 2003. " Compensating Wage Differentials for Fatal and Nonfatal Injury Risk by Gender and Race," Journal of Risk and Uncertainty, Springer, vol. 27(3), pages 257-77, December.
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