Life-Cycle Consumption and the Age-Adjusted Value of Life
Our research examines empirically the age pattern of the implicit value of life revealed from workers' differential wages and job safety pairings. Although aging reduces the number of years of life expectancy, aging can affect the value of life through an effect on planned life-cycle consumption. The elderly could, a priori, have the highest implicit value of life if there is a life-cycle plan to defer consumption until old age. We find that largely due to the age pattern of consumption, which is non-constant, the implicit value of life rises and falls over the lifetime in a way that the value for the elderly is higher than the average over all ages or for the young. There are important policy implications of our empirical results. Because there may be age-specific benefits of programs to save statistical lives, instead of valuing the lives of the elderly at less than the young, policymakers should more correctly value the lives of the elderly at as much as twice the young because of relatively greater consumption lost when accidental death occurs.
|Date of creation:||Feb 2004|
|Date of revision:|
|Publication status:||published as Kniesner, Thomas, W. Kip Viscusi, and James Ziliak. 2006. "Life-Cycle Consumption and the Age-Adjusted Value of Life," Contributions to Economic Analysis & Policy, Berkeley Electronic Press, vol. 5(1), pages 1524-1524|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
More information through EDIRC
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.:
- Bruce D. Meyer & James X. Sullivan, 2003. "Measuring the Well-Being of the Poor Using Income and Consumption," NBER Working Papers 9760, National Bureau of Economic Research, Inc.
- Johannesson, Magnus & Johansson, Per-Olov & Löfgren, Karl-Gustaf, 1997.
"On the Value of Changes in Life Expectancy: Blips versus Parametric Changes,"
SSE/EFI Working Paper Series in Economics and Finance
152, Stockholm School of Economics.
- Johannesson, Magnus & Johansson, Per-Olov & Lofgren, Karl-Gustaf, 1997. "On the Value of Changes in Life Expectancy: Blips versus Parametric Changes," Journal of Risk and Uncertainty, Springer, vol. 15(3), pages 221-39, December.
- W. Kip Viscusi & Joseph E. Aldy, 2003.
"The Value of a Statistical Life: A Critical Review of Market Estimates throughout the World,"
NBER Working Papers
9487, National Bureau of Economic Research, Inc.
- 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.
- Garen, John, 1988. "Compensating Wage Differentials and the Endogeneity of Job Riskiness," The Review of Economics and Statistics, MIT Press, vol. 70(1), pages 9-16, February.
- Arthur, W B, 1981. "The Economics of Risks to Life," American Economic Review, American Economic Association, vol. 71(1), pages 54-64, March.
- repec:reg:rpubli:282 is not listed on IDEAS
- W. Kip Viscusi, 2004. "The Value of Life: Estimates with Risks by Occupation and Industry," Economic Inquiry, Western Economic Association International, vol. 42(1), pages 29-48, January.
- Kevin Lang & Sumon Majumdar, 2003. "The Pricing of Job Characteristics When Markets Do Not Clear: Theory and Implications," NBER Working Papers 9911, National Bureau of Economic Research, Inc.
- Sherwin Rosen, .
"The Value of Changes in Life Expectancy,"
University of Chicago - Population Research Center
87-14, Chicago - Population Research Center.
- Johansson, Per-Olov, 2001. "Is there a meaningful definition of the value of a statistical life?," Journal of Health Economics, Elsevier, vol. 20(1), pages 131-139, January.
- Johansson, Per-Olov, 2002. "On the Definition and Age-Dependency of the Value of a Statistical Life," Journal of Risk and Uncertainty, Springer, vol. 25(3), pages 251-63, November.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:10266. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.