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ifo Institut – Leibniz-Institut für Wirtschaftsforschung an der Universität München >
CESifo Working Papers, CESifo Group Munich >
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http://hdl.handle.net/10419/26336
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| Title: | | The value of a statistical life under ambiguity aversion  |
| Authors: | | Treich, Nicolas |
| Issue Date: | | 2008 |
| Series/Report no.: | | CESifo working paper 2291 |
| Abstract: | | We show that ambiguity aversion increases the value of a statistical life as soon as the marginal utility of wealth is higher if alive than dead. The intuition is that ambiguity aversion has a similar effect as an increase in the perceived baseline mortality risk, and thus operates as the dead anyway effect. We suggest, however, that ambiguity aversion should usually have a modest effect on the prevention of ambiguous mortality risks within benefit-cost analysis, and can hardly justify the substantial ambiguity premium apparently embodied in environmental policy-making. |
| Subjects: | | ambiguity value-of-a-statistical-life uncertainty risk-aversion willingness-topay benefit-cost analysis environmental risk health policy |
| JEL: | | D81 Q51 I18 |
| Document Type: | | Working Paper |
| Appears in Collections: | | CESifo Working Papers, CESifo Group Munich
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