Defining the value of a statistical life: a comment

In a recent paper [J. Hlth. Econom. 20 (2001) 131] Per-Olov Johansson claims to demonstrate that a commonly used intuitive definition of the value of a statistical life (VSL) is wrong, and that empirical estimates of VSLs are biased estimators of what he defines as the theoretically correct concept...

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Bibliographic Details
Published in:Journal of health economics 2002-01, Vol.21 (1), p.169-175
Main Author: Blomqvist, Ake
Format: Article
Language:English
Subjects:
Data Interpretation, Statistical
Economic theory
Economics
Estimates
Health
Health administration
Health economics
Humans
Life
Life Expectancy
Methods
Models, Econometric
Mortality
Quality-Adjusted Life Years
Statistical analysis
United States
Valuation
Value
Value of Life - economics
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Summary:In a recent paper [J. Hlth. Econom. 20 (2001) 131] Per-Olov Johansson claims to demonstrate that a commonly used intuitive definition of the value of a statistical life (VSL) is wrong, and that empirical estimates of VSLs are biased estimators of what he defines as the theoretically correct concept of the value of saving a life. In this comment I first argue in favor of a theoretically correct concept that is different from Johansson's because it incorporates the risk of death into the individual's lifetime budget constraint. I then show that the common intuitive definition of a VSL in fact is consistent with the theoretically correct concept and thus, provides an appropriate empirical basis for estimating the value to society of mortality-reducing projects.
ISSN:0167-6296
1879-1646
DOI:10.1016/S0167-6296(01)00113-8