EN       DE
 
  Home   Search  
IDSC
 
IZA Newsroom
  Site Map   Contact   Member Login
   

IZA

Logo
Policy Relevant Heterogeneity in the Value of Statistical Life: New Evidence from Panel Data Quantile Regressions
by Thomas J. Kniesner, W. Kip Viscusi, James P. Ziliak
(October 2009)
published in: Journal of Risk and Uncertainty, 2010, 40 (1), 15-32

Abstract:
We examine differences in the value of statistical life (VSL) across potential wage levels in panel data using quantile regressions with intercept heterogeneity. Latent heterogeneity is econometrically important and affects the estimated VSL. Our findings indicate that a reasonable average cost per expected life saved cut-off for health and safety regulations is $7 million to $8 million per life saved, but the VSL varies considerably across the labor force. Our results reconcile the previous discrepancies between hedonic VSL estimates and the values implied by theories linked to the coefficient of relative risk aversion. Because the VSL varies elastically with income, regulatory agencies should regularly update the VSL used in benefit assessments, increasing the VSL proportionally with changes in income over time.
Text: See Discussion Paper No. 4508  




 

© IZA  Impressum  Last updated: 2014-02-19  webmaster@iza.org    |   Bookmark this page    |   Print View