Environmental and Resource Economics

, Volume 49, Issue 4, pp 597–624 | Cite as

The Effect of Risk Context on the Value of a Statistical Life: a Bayesian Meta-model

  • Thijs Dekker
  • Roy Brouwer
  • Marjan Hofkes
  • Klaus Moeltner
Open Access
Article

Abstract

This paper presents the first value of statistical life (VSL) meta-analysis that empirically estimates correction factors for ‘out of context’ benefits transfer (BT) purposes. In the field of mortality risk reductions elicited willingness to pay values in one risk context, say road safety, are frequently applied in other risk contexts like air pollution. However, differences in risk perception and the population at risk across contexts are likely to result in diverging VSL estimates. In a meta-analysis of 26 international stated preference studies, a Bayesian model is estimated regressing contingent values for mortality risk reductions, originating from three different risk contexts, on the characteristics of the risk reduction itself and additional variables characterizing the underlying studies. A willingness to pay (WTP) premium for mortality risk reductions in the air pollution and general mortality risk context relative to improving road safety is observed. Evaluated at the mean, road safety VSL estimates should be multiplied by a factor 1.8 before being applicable in the air pollution context. Moreover, in an illustrative BT exercise we find limited overlap in the set of context specific predictive VSL distributions. Consequently, ‘out of context’ BT results in a substantial over- or underestimation of the VSL.

Keywords

Value of statistical life Meta-analysis Bayesian estimation Mortality Risk context 

Notes

Acknowledgments

We would like to thank Arianne de Blaeij for sharing her VSL road safety database and Vanessa Daniel for useful comments on an earlier draft. We would also like to thank an anonymous reviewer for providing helpful suggestions to improve the paper. This report was carried out under the Dutch National Research Programme “Climate Changes Spatial Planning” (www.klimaatvoorruimte.nl).

Open Access

This article is distributed under the terms of the Creative Commons Attribution Noncommercial License which permits any noncommercial use, distribution, and reproduction in any medium, provided the original author(s) and source are credited.

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Copyright information

© The Author(s) 2011

Authors and Affiliations

  • Thijs Dekker
    • 1
  • Roy Brouwer
    • 1
  • Marjan Hofkes
    • 1
  • Klaus Moeltner
    • 2
  1. 1.Institute for Environmental StudiesVU University AmsterdamAmsterdamThe Netherlands
  2. 2.Department of Agricultural and Applied EconomicsVirginia TechBlacksburgUSA

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