Abstract
Individuals’ perception of their own road-traffic and overall mortality risks are examined in this paper. Perceived risk is compared with the objective risk of the respondents’ peers, i.e. their own gender and age group, and the results suggest that individuals’ risk perception of their own risk is biased. For road-traffic risk we obtain similar results to what have been found previously in the literature, overassessment and underassessment among low- and high-risk groups, respectively. For overall risk we find that all risk groups underestimate their risk. The results also indicate that men's risk bias is larger than women’s.
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Notes
What defines an objective risk measure is hard to determine, since “danger is real, but risk is socially constructed” (Slovic, 1999, p. 699). Frequencies of fatalities or the chance of fatality, i.e. the probability of death, are often used as measures of objective risk, and we follow this tradition. Thus, statistical risk defines objective risk in this paper.
Road-traffic risk refers to all traffic risks individuals are faced with in the road environment, e.g. as pedestrians, bicyclists, users of public transports, car users, etc. Controllable risks are risks from hazardous activities which can be regarded as voluntary and where the individual by his/her actions can influence his/her risk exposure.
For references see Andersson (2007).
Sampling weights were not used in the analysis of risk formation, since STATA does not allow sampling weights in “Seemingly Unrelated Regressions-models.”
For a description of the different models, see any econometric textbook, e.g. Wooldridge (2002).
Arithmetic means are presented in Table 8 in the appendix. The numbers of observations differ, since zero answers were dropped when the geometric means were estimated.
The coefficient estimates in Table 4 denote marginal effects. Let \(\Phi(\cdot)\), \(\phi(\cdot), x, \bar{x}\), and β, denote the standard cumulative normal distribution, normal density function, explanatory variables, mean value, and coefficients, respectively; then the marginal effects are calculated in STATA (StataCorp, 2001) as:
$$ \frac{\partial\Phi(x\beta)}{\partial x_1}=\phi(\bar{x}\beta)\beta_1. $$(6)\(\frac{\partial\text{ln(Perceived)}}{\partial\text{ln(Objective)}}=\alpha_1+2\alpha_2\text{ln(Objective).}\)
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Acknowledgments
The authors would like to thank Gunnar Lindberg, Björn Lindgren, and seminar and conference participants at VTI and Lund University the “\(26{\text{th}}\) Nordic Health Economists’ Study Group Meeting” for valuable comments on earlier drafts of this paper. Financial support from Vinnova, the Swedish National Road Administration, the Swedish Council for Working Life and Social Research Handelsbankens forskningsstiftelser is gratefully acknowledged. The authors are solely responsible for the results presented and views expressed in this paper.
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JEL Classification C21, D81, D83, I18
Appendix: Arithmetic means
Appendix: Arithmetic means
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Andersson, H., Lundborg, P. Perception of own death risk. J Risk Uncertainty 34, 67–84 (2007). https://doi.org/10.1007/s11166-006-9004-3
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DOI: https://doi.org/10.1007/s11166-006-9004-3