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Measuring the Value of a Statistical Life: Problems and Prospects

32 Pages Posted: 25 Jan 2006  

Orley Ashenfelter

Princeton University - Industrial Relations Section; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

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Date Written: January 2006

Abstract

Tradeoffs between monetary wealth and fatal safety risks are summarized in the value of a statistical life (VSL), a measure that is widely used for the evaluation of public policies in medicine, the environment, and transportation safety. This paper demonstrates the widespread use of this concept and summarizes the major issues, both theoretical and empirical, that must be confronted in order to provide a credible estimate of a VSL. The paper concludes with an application of these issues to a particular study of speed limits and highway safety.

Keywords: value of a statistical life, speed limits, safety risks, evaluation

JEL Classification: J17, H43, I18, R4

Suggested Citation

Ashenfelter, Orley, Measuring the Value of a Statistical Life: Problems and Prospects (January 2006). IZA Discussion Paper No. 1911; Princeton Law and Public Affairs Working Paper No. 06-002. Available at SSRN: https://ssrn.com/abstract=877890 or http://dx.doi.org/10.2139/ssrn.877890

Orley Ashenfelter (Contact Author)

Princeton University - Industrial Relations Section ( email )

Princeton, NJ 08544-2098
United States
609-258-4040 (Phone)
609-258-2907 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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