Risk Aversion and the Value of Risk to Life

Arbeitspapier

The standard literature on the value of life relies on Yaari’s (1965) model, which includes an implicit assumption of risk neutrality with respect to life duration. To overpass this limitation, we extend the theory to a simple variety of preferences which are not necessarily additively separable. The enlargement we propose is relevant for the evaluation of life-saving programs: current practice, we estimate, puts too little weight on mortality risk reduction of the young. Our correction exceeds in magnitude that introduced by the switch from the notion of number of lives saved to the notion of years of life saved.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Economics Working Paper Series ; No. 10/133

Classification and Topics

• Classification: Wirtschaft ; Allocative Efficiency; Cost-Benefit Analysis ; Criteria for Decision-Making under Risk and Uncertainty ; Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making‡ ; Health: Government Policy; Regulation; Public Health ; Value of Life; Forgone Income
• Subject: Value of Statistical Life ; Lifecycle Behavior ; Cost-benefit Analysis ; Lebenszyklus ; Sterblichkeit ; Kosten-Nutzen-Analyse ; Risikoaversion ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Bommier, Antoine ; Villeneuve, Bertrand
• Event: Veröffentlichung
• (who): ETH Zurich, CER-ETH - Center of Economic Research
• (where): Zurich
• (when): 2010

Further information

• DOI: doi:10.3929/ethz-a-006154490
• Handle: http://hdl.handle.net/10419/171576
• Last update: 10.03.2025, 11:44 AM CET