Eliciting Subjective Beliefs About Mortality Risk Orderings

UCF Economics Working Paper No. 03-20

36 Pages Posted: 20 Apr 2005

See all articles by Glenn W. Harrison

Glenn W. Harrison

Georgia State University - J. Mack Robinson College of Business

E. Elisabet Rutström

University of Central Florida - College of Business Administration

Date Written: December 2004

Abstract

We develop an experimental method to elicit subjective beliefs about the ordering of mortality risk over different causes of death. The experimental procedure emphasizes incentive-compatibility, so that the individual has a positive financial incentive to respond truthfully. We also consider the extent to which individuals have subjective beliefs for sub-segments of the population that are more accurate than their beliefs about the risks for the population as a whole. We propose several hypotheses concerning the degree of familiarity of the risks, and find that the evidence supports those hypotheses. The evidence also suggests that there is no discernible difference between beliefs elicited using hypothetical or real financial rewards in the elicitation format we use. Our findings restore some confidence in the ability to elicit beliefs about mortality risks, and therefore to get reliable estimates of the monetary value of a statistical life.

Keywords: Subjective beliefs, mortality risk, experiments

JEL Classification: D84, C91

Suggested Citation

Harrison, Glenn William and Rutstrom, Elisabet, Eliciting Subjective Beliefs About Mortality Risk Orderings (December 2004). UCF Economics Working Paper No. 03-20, Available at SSRN: https://ssrn.com/abstract=698544 or http://dx.doi.org/10.2139/ssrn.698544

Glenn William Harrison (Contact Author)

Georgia State University - J. Mack Robinson College of Business ( email )

P.O. Box 4050
Atlanta, GA 30303-3083
United States
407-489-3088 (Phone)
253-830-7636 (Fax)

HOME PAGE: http://www.cear.gsu.edu/

Elisabet Rutstrom

University of Central Florida - College of Business Administration ( email )

PO Box 161400
Orlando, FL 32816
United States

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