Age Variations in Workers' Value of Statistical Life
57 Pages Posted: 19 Oct 2004
There are 2 versions of this paper
Age Variations in Workers' Value of Statistical Life
Age Variations in Workers' Value of Statistical Life
Date Written: March 2004
Abstract
This paper develops a life-cycle model in which workers choose both consumption levels and job fatality risks, implying that the effect of age on the value of life is ambiguous. The empirical analysis of this relationship uses novel, age-dependent fatal and nonfatal risk variables. Workers' value of statistical life exhibits an inverted U-shaped relationship over workers' life cycle based on hedonic wage model estimates, age-specific hedonic wage estimates, and a minimum distance estimator. The value of statistical life for a 60-year-old ranges from $2.5 million to $3.0 million - less than half the value for 30- to 40-year-olds.
Keywords: value of life, job risks, hedonic wage regression, VSLY
JEL Classification: J17, I12
Suggested Citation: Suggested Citation
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