Article

Journal of Risk and Uncertainty

, Volume 28, Issue 1, pp 73-95

First online:

Effects of Disease Type and Latency on the Value of Mortality Risk

  • James K. HammittAffiliated withDepartment of Health Policy and Management and Center for Risk Analysis, Harvard School of Public Health Email author 
  • , Jin-Tan LiuAffiliated withDepartment of Economics, National Taiwan University

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Abstract

We evaluate the effects of disease type and latency on willingness to pay (WTP) to reduce environmental risks of chronic, degenerative disease. Using contingent-valuation data collected from approximately 1,200 respondents in Taiwan, we find that WTP declines with latency between exposure to environmental contaminants and manifestation of any resulting disease, at a 1.5 percent annual rate for a 20 year latency period. WTP to reduce the risk of cancer is estimated to be about one-third larger than WTP to reduce risk of a similar chronic, degenerative disease. The value of risk reduction also depends on the affected organ, environmental pathway, or payment mechanism: estimated WTP to reduce the risk of lung disease due to industrial air pollution is twice as large as WTP to reduce the risk of liver disease due to contaminated drinking water.

health risk contingent valuation willingness to pay value per statistical life cancer latency Taiwan