Journal of Risk and Uncertainty
value of a statistical life, fatality risk, income elasticity, blame, children
Law | Torts | Workers' Compensation Law
The refinement in worker fatality risk data used in hedonic wage studies and evidence from new stated preference studies have facilitated the exploration of the heterogeneity of the value of statistical life (VSL). Although the median VSL estimate for workers is $7-$8 million, the VSL varies considerably within the worker population. New estimates of the income elasticity of VSL are 1.0 or above, which are consistent with theoretical models linking VSL to the coefficient of relative risk aversion. The specific relationship between VSL and risk aversion is, however, more complex than previously understood. Age differences in VSL are substantial, with young children being accorded especially high VSL amounts. The public’s willingness to pay to reduce risks is reduced if those being protected are perceived as being blameworthy due to their responsibility for contributing to the risk.
W. Kip Viscusi,
The Heterogeneity of the Value of Statistical Life: Introduction and Overview, 40 Journal of Risk and Uncertainty. 1
Available at: https://scholarship.law.vanderbilt.edu/faculty-publications/129