Document Type
Article
Publication Title
Journal of Legal Studies
Publication Date
4-2015
ISSN
1537-5366
Page Number
S387
Keywords
prescription drugs, regulations, Food and Drug Administration
Disciplines
Behavioral Economics | Health Economics | Health Law and Policy | Law
Abstract
Willingness-to-pay (WTP) values and willingness-to-accept (WTA) values have received considerable attention, but the role of reference-dependence effects is more diverse. Policies involving cost and risk may have reference point effects with respect to both cost and risk, leading to four potential valuation measures. Experimental evidence for water quality policies suggests that the cost reference effects are particularly influential in that context. There is, however, no evidence of significant reference effects for labor market estimates of the value of a statistical life. Sound application of benefit values other than WTP measures requires pertinent empirical evidence and an assessment of the underlying rationality of the determinants of the reference-dependence effects.
Recommended Citation
W. Kip Viscusi,
Reference-Dependence Effects in Benefit Assessment: Beyond the WTA-WTP Dichotomy and WTA-WTP Ratios, 44 Journal of Legal Studies. S387
(2015)
Available at: https://scholarship.law.vanderbilt.edu/faculty-publications/1564