The Heterogeneity of the Value of Statistical Life: Introduction and Overview

25 Pages Posted: 2 Dec 2009

See all articles by W. Kip Viscusi

W. Kip Viscusi

Vanderbilt University - Law School; National Bureau of Economic Research (NBER); Vanderbilt University - College of Arts and Science - Department of Economics; Vanderbilt University - Owen Graduate School of Management; Vanderbilt University - Strategy and Business Economics

Date Written: November 25, 2009

Abstract

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.

Keywords: value of statistical life, fatality risk, VSL, income elasticity, blame, children

JEL Classification: I10, J17, J28, K00, C23

Suggested Citation

Viscusi, W. Kip, The Heterogeneity of the Value of Statistical Life: Introduction and Overview (November 25, 2009). Journal of Risk and Uncertainty, Vol. 40, No. 1, February 2010, Vanderbilt Law and Economics Research Paper No. 09-32, Available at SSRN: https://ssrn.com/abstract=1516002

W. Kip Viscusi (Contact Author)

Vanderbilt University - Law School ( email )

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HOME PAGE: http://law.vanderbilt.edu/bio/?pid=w-kip-viscusi

National Bureau of Economic Research (NBER)

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Vanderbilt University - College of Arts and Science - Department of Economics

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(615) 343-7715 (Phone)
(615) 343-5953 (Fax)

HOME PAGE: http://as.vanderbilt.edu/economics/bio/wkip-viscusi/

Vanderbilt University - Owen Graduate School of Management

401 21st Avenue South
Nashville, TN 37203
United States
(615) 343-7715 (Phone)
(615) 343-5953 (Fax)

HOME PAGE: http://business.vanderbilt.edu/bio/w-kip-viscusi/

Vanderbilt University - Strategy and Business Economics

Nashville, TN 37203
United States

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