Journal of Risk and Uncertainty

, Volume 34, Issue 2, pp 155–178

Paying for permanence: Public preferences for contaminated site cleanup

  • Anna Alberini
  • Stefania Tonin
  • Margherita Turvani
  • Aline Chiabai
Article

Abstract

We use conjoint choice questions to investigate the preferences of people in four cities in Italy for income and future/permanent mortality risk reductions delivered by contaminated site remediation policies. The VSL is €5.6 million for an immediate risk reduction. If the risk reduction takes place 20 years from now, the implied VSL is €1.26 million. Respondents’ implicit discount rate is 7%. The VSL depends on respondent characteristics, familiarity with contaminated sites, concern about the health effects of exposure to toxicants, having a family member with cancer, perceived usefulness of public programs and beliefs about the goals of government remediation programs.

Keywords

Value of a statistical life Latent risk reductions Individual discount rates Conjoint choice questions Contaminated sites Remediation 

JEL Classification

J17 I18 K32 Q51 Q53 

References

  1. Agenzia per la Protezione dell’Ambiente e per i Servizi Tecnici (APAT). (2004). “Metodologie, Tecniche e Procedure per il Supporto degli Interventi di Valorizzazione dei Siti Inquinati,” Rome, June.Google Scholar
  2. Alberini, Anna, and Aline Chiabai. (2007). “Urban Environmental Health and Sensitive Populations: How Much Are the Italians Willing to Pay to Reduce Their Risks?” Regional Science and Urban Economics 37(2), 239–258.CrossRefGoogle Scholar
  3. Alberini, Anna, Maureen Cropper, Alan Krupnick and Nathalie Simon. (2006a). “Willingness to Pay for Risk Reduction: Does Latency Matter?” Journal of Risk and Uncertainty 32(3), 231–245.CrossRefGoogle Scholar
  4. Alberini, Anna, Stefania Tonin, Margherita Turvani, and Aline Chiabai. (2006b). “Paying for Permanence: Public Preferences for Contaminated Site Cleanup,” FEEM working paper 113.06, Milan, Italy, September.Google Scholar
  5. Andersson, Henrik. (2005). “The Value of Safety as Revealed in the Swedish Car Market: An Application of the Hedonic Pricing Approach,” Journal of Risk and Uncertainty 30(3), 211–239.CrossRefGoogle Scholar
  6. Banca d’Italia. (2006). “I bilanci delle famiglie italiane nell’anno 2004,” Supplementi al Bollettino statistico anno XVI, no. 7, Rome, January.Google Scholar
  7. Blomquist, Glenn. (1979). “Value of Life Saving: Implications of Consumption Activity,” The Journal of Political Economy 87(3), 540–558.CrossRefGoogle Scholar
  8. Carlsson, Fredrik, and Peter Martinsson. (2006). “How Much is Too Much? An Investigation of the Effect of Number of Choice Sets, Starting Point and the Choice of Bid Vectors in Choice Experiments,” Working papers in Economics 191. Sweden: Göteborg University.Google Scholar
  9. Chilton, Susan, Judith Covey, Lorraine Hopkins, Michael Jones-Lee, Graham Loomes, Nick Pidgeon, and Anne Spencer. (2002). “Public Perceptions of Risk and Preference-based Values of Safety,” Journal of Risk and Uncertainty 25(3), 211–232.CrossRefGoogle Scholar
  10. Cropper, Maureen L., Sema K. Aydede, and Paul R. Portney. (1991). “Discounting Human Lives,” American Journal of Agricultural Economics 73(5), 1410–1415.CrossRefGoogle Scholar
  11. Cropper, Maureen L., Sema K. Aydede, and Paul R. Portney. (1992). “Rates of Time Preference for Saving Lives,” American Journal of Agricultural Economics 82(2), 469–472.Google Scholar
  12. Davidson, Debra J., and Wiluam R. Freudenburg. (1996). “Gender and Environmental Concerns: A Review and Analysis of Available Research,” Environmental Behavior 28, 302–339.CrossRefGoogle Scholar
  13. DeShazo, J.R., and Trudy A. Cameron. (2005). “The Effect of Health Status on Willingness to Pay for Morbidity and Mortality Risk Reductions,” California Center for Population Research On-line Working Paper Series, CCPR-050-05.Google Scholar
  14. Eeckhoudt, Louis R., and James K. Hammitt. (2001). “Background Risks and the Value of a Statistical Life,” Journal of Risk and Uncertainty 23(3), 261–279.CrossRefGoogle Scholar
  15. Fischhoff, Baruch, Paul Slovic, Sarah Lichtenstein, Stephen Read and Barbara Combs. (1978). “How Safe is Safe Enough? A Psychometric Study of Attitudes towards Technological Risks and Benefits,” Policy Sciences 9, 127–152.CrossRefGoogle Scholar
  16. Gayer, Ted, James T. Hamilton, and W. Kip Viscusi. (2000). “Private Values of Risk Tradeoffs at Superfund Sites: Housing Market Evidence on Learning About Risks,” Review of Economics and Statistics 82(3), 439–451.CrossRefGoogle Scholar
  17. Gayer, Ted, James T. Hamilton, and W. Kip Viscusi. (2002). “The Market Value of Reducing Cancer Risk: Hedonic Housing Prices with Changing Information,” Southern Economic Journal 69(2), 266–289.CrossRefGoogle Scholar
  18. Gazzetta Ufficiale. (1997). “Decreto Legislativo 5 febbraio 1997, N. 22, Attuazione delle direttive 91/156/CEE sui rifiuti, 91/689/CEE sui rifiuti pericolosi e 94/62/CE sugli imballaggi e sui rifiuti di imballaggio,” Supplemento Ordinario n. 33, Rome, 15 February.Google Scholar
  19. Gazzetta Ufficiale. (2006). “Decreto Legislativo 3 aprile 2006, n. 152, Norme in materia ambientale, N. 88,” Supplemento Ordinario N. 96, Rome, 14 April.Google Scholar
  20. Gupta, Shreekant, George van Houtven, and Maureen Cropper. (1996). “Paying for Permanence: An Economic Analysis of EPA’s Cleanup Decisions at Superfund Sites,” RAND Journal of Economics 27(3), 563–582.CrossRefGoogle Scholar
  21. Hakes, Jahn Karl, and W. Kip Viscusi. (2004). “Dead Reckoning: Demographic Determinants of the Accuracy of Mortality Risk Perceptions,” Risk Analysis 24(3), 651–664.CrossRefGoogle Scholar
  22. Hammitt, James K., and Jin-Tan Liu. (2004). “Effects of Disease Type and Latency on the Value of Mortality Risk,” The Journal of Risk and Uncertainty 28(1), 73–95.CrossRefGoogle Scholar
  23. Hanley, Nick, Susana Mourato, and Robert E. Wright. (2001). “Choice Modelling Approaches: A Superior Alternative for Environmental Valuation?” Journal of Economic Surveys 15(3), 435–462.CrossRefGoogle Scholar
  24. Horowitz, John K., and Richard T. Carson. (1990). “Discounting Statistical Lives,” Journal of Risk and Uncertainty 3, 403–413.CrossRefGoogle Scholar
  25. Itaoka, Kenshi, Aya Saito, Alan Krupnick, Wiktor Adamowicz and Taketoshi Taniguchi. (2006). “The Effect of Risk Characteristics on the Willingness to Pay for Mortality Risk Reductions from Electric Power Generation,” Environmental and Resource Economics 33(3), 371–398.CrossRefGoogle Scholar
  26. Ladenburg, Jacob, and Søren Bøye Olsen. (2006). “Gender Specific Starting Point Bias in Choice Experiments: Evidence from an Empirical Study,” Frederiksberg, Denmark: The Royal Veterinary and Agricultural University (draft manuscript).Google Scholar
  27. Legambiente. (2005). “La chimera delle bonifiche,” http://www.legambiente.com/documenti/2005/0510_dossier_bonifiche/La_chimera_delle_bonifiche.pdf (accessed January 31, 2006).
  28. Martuzzi, Marco, Francesco Mitis, Aannibale Biggeri, Benedetto Terracini, and Roberto Bertollini. (2002). “Ambiente e stato di salute nella popolazione delle aree ad alto rischio di crisi ambientale in Italia,” Epidemiologia e Prevenzione 26(6), 1–56.Google Scholar
  29. McDaniels, Timothy L., Mark S. Kamlet, and Gregory W. Fischer. (1992). “Risk Perception and the Value of Safety,” Risk Analysis 12, 495–503.CrossRefGoogle Scholar
  30. Meyer, Peter B. (2000). “Looking at State Voluntary Cleanup Programs in Perspective: Liability Relief, Flexible Cleanup Standards and Institutional Controls as Forms of Economic Development Subsidies,” Working Paper, Center for Environmental Policy and Management, University of Louisville.Google Scholar
  31. Mitis, Francesco, Marco Martuzzi, Annibale Biggeri, Roberto Bertollini, and Benedetto Terracini. (2005). “Industrial Activities in Sites at High Environmental Risk and Their Impact on the Health of the Population,” International Journal of Occupational and Environmental Health 11, 88–95.Google Scholar
  32. Moore, Michael J., and W. Kip Viscusi. (1990). “Models for Estimating Discount Rates for Long-term Health Risks Using Labor Market Data,” Journal of Risk and Uncertainty 3, 381–401.CrossRefGoogle Scholar
  33. Patassini, Domenico, Paola Cossettini, Enrico De Polignol, Markus Hedorfer, and Enrico Rinaldi. (2003). “El.Gi.R.A. Una procedura di aiuto alla conoscenza nelle aree di bonifica di Porto Marghera (Venezia).” Paper presented at a FEEM seminar, http://www.iuav.it/Didattica1/pagine-web/facolt–di2/Domenico-P/ricerca/Bonifiche-/slide_ELGIRA.pdf (accessed July 31, 2006).
  34. Patassini, Domenico, Paola Cossettini, Enrico De Polignol, Markus Hedorfer, and Enrico Rinaldi. (2005). “ELGIRA: Support System for Knowledge Building and Evaluation in Brownfield Redevelopment.” In CORILA (ed.), Scientific Research and Safeguarding of Venice, Research Programme 2001–2003, Volume III, CORILA, Venice, 5–20.Google Scholar
  35. Regione del Veneto and Comune di Venezia. (2004). “Master Plan per la bonifica dei siti inquinati di Porto Marghera,” http://www.regione.veneto.it/NR/rdonlyres/408958E0-542A-4227-9CF9-46025D51DBDF/0/134.pdf (accessed August 2, 2006).
  36. Revesz, Richard L., and Richard B. Stewart. (1995). “The Superfund Debate,” In Richard L. Revesz and Richard B. Stewart (eds.), Analyzing Superfund: Economics, Science, and Law. Washington, DC: Resources for the Future.Google Scholar
  37. Savage, Ian. (1993). “Demographic Influences on Risk Perceptions,” Risk Analysis 13(4), 413–420.CrossRefGoogle Scholar
  38. Sunstein, Cass R. (2004). “Are Poor People Worth Less than Rich People? Disaggregating the Value of a Statistical Life,” AEI-Brookings Joint Center for Regulatory Studies Working paper 04-05, Washington, DC, January.Google Scholar
  39. Tsuge, Takahiro, Atsuo Kishimoto, and Kenji Tekeuchi. (2005). “A Choice Experiment to the Valuation of Mortality,” Journal of Risk and Uncertainty 31(1), 73–95.CrossRefGoogle Scholar
  40. U.S. Environmental Protection Agency. (1989). Risk Assessment Guidance for Superfund, Washington, DC: Office of Solid Waste and Emergency Response 9285.701A.Google Scholar
  41. U.S. Environmental Protection Agency. (1991). Role of Baseline Risk Assessment in Superfund Remedy Selection Decisions, Washington, DC: Office of Solid Waste and Emergency Response 9355.30.Google Scholar
  42. U.S. Environmental Protection Agency. (2000). Guidelines for Preparing Economic Analyses, EPA 240-R-00-003, Washington, DC: September.Google Scholar
  43. U.S. Environmental Protection Agency. (2003). Arsenic in Drinking Water: Cessation Lag Model, EPA 815-R-03-008, Office of Water, Washington, DC: January.Google Scholar
  44. U.S. General Accounting Office. (1997). Superfund: State Voluntary Programs Provide Incentives to Encourage Cleanups, GAO/RCED-97-66, Washington, DC: April.Google Scholar
  45. Vassanadumrongdee, Sujitra, and Shunji Matsuoka. (2005). “Risk Perceptions and Value of a Statistical Life for Air Pollution and Traffic Accidents: Evidence from Bangkok, Thailand,” Journal of Risk and Uncertainty 30(3), 261–287.CrossRefGoogle Scholar
  46. Verdecchia, Arduino, Angela Mariotto, Riccardo Capocaccia, Gemma Gatta, Andrea Micheli, Milena Sant, and Franco Berrino. (2001). “Incidence and Prevalence of all Cancerous Diseases in Italy: Trends and Implications,” European Journal of Cancer 37, 1149–1157.CrossRefGoogle Scholar
  47. Viscusi, W. Kip. (1993). “The Value of Risks to Life and Health,” Journal of Economic Literature 31(4), 1912–1946.Google Scholar
  48. Viscusi, W. Kip, and Joseph E. Aldy. (2003). “The Value of a Statistical Life: A Critical Review of Market Estimates Throughout the World,” Journal of Risk and Uncertainty 27(1), 5–76.CrossRefGoogle Scholar
  49. Viscusi, W. Kip, and James T. Hamilton. (1999). “Are Risk Regulators Rational? Evidence from Hazardous Waste Cleanup Decisions,” American Economic Review 89(4), 1010–1027.CrossRefGoogle Scholar
  50. Viscusi, W. Kip, Wesley A. Magat, and Joel Huber. (1991). “Pricing Environmental Health Risks: Survey Assessments of Risk–risk and Risk–dollar Tradeoffs for Chronic Bronchitis,” Journal of Environmental Economics and Management 21, 32–51.CrossRefGoogle Scholar
  51. Walker, Katherine D., March Sadowitz, and John D. Graham. (1995). “Confronting Superfund Mythology: The Case of Risk Assessment and Management.” In Richard L. Revesz and Richard B. Stewart (eds.), Analyzing Superfund: Economics, Science and Law. Washington, DC: Resources for the Future.Google Scholar

Copyright information

© Springer Science+Business Media, LLC 2007

Authors and Affiliations

  • Anna Alberini
    • 1
  • Stefania Tonin
    • 2
  • Margherita Turvani
    • 2
  • Aline Chiabai
    • 3
  1. 1.AREC, 2200 Symons HallUniversity of MarylandCollege ParkUSA
  2. 2.Department of PlanningUniversity of Venice-IUAVVeniceItaly
  3. 3.Fondazione Eni Enrico MatteiVeniceItaly

Personalised recommendations