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Environmental and Resource Economics

, Volume 49, Issue 1, pp 121–146 | Cite as

A Mixed Logit Approach to Study Preferences for Safety on Alpine Roads

  • Christoph M. RheinbergerEmail author
Article

Abstract

This paper presents a mixed logit approach to the valuation of reductions in mortality risk on Alpine roads. In addition to common road accidents, users of these roads face risks from natural hazards such as avalanches and rockfalls. Moreover, the individual risk of road users varies with the frequency of their exposure. Drawing on choice experimental data of frequently exposed respondents from a mountainous region and less frequently exposed respondents from a city in Switzerland, we are able to estimate the value of statistical life (VSL). Furthermore, we explore how respondents differ in their individual willingness-to-pay depending on exposure and other individual characteristics. Our estimates of the VSL in the context of fatal accidents on Alpine roads are in the range of CHF 6.0–7.8 million (€3.9–5.1 million). We find the VSL to be dependent on socio-economic and perceptional factors but to be not significantly altered by the type of hazard. These findings imply that the VSL might be adjusted to account for heterogonous risk preferences of different societal groups, but there is no evidence of a ‘dread’ premium for natural hazards.

Keywords

Mortality risk Value of statistical life Natural and man-made hazards Mixed logit model Preference heterogeneity 

JEL Classification

D81 J17 R42 

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Copyright information

© Springer Science+Business Media B.V. 2010

Authors and Affiliations

  1. 1.LERNA, Toulouse School of Economics, Manufacture des TabacsToulouseFrance
  2. 2.WSL Institute for Snow and Avalanche ResearchDavosSwitzerland

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