QALYs versus WTP

This article focuses on the value of mortality risk reduction, an important component of the benefits estimates for environmental policies. In recent years, the number, scope, and quality of valuation studies have increased dramatically. Revealed-preference studies of wage compensation for occupational risks, on which analysts have primarily relied, have benefited from improved data and statistical methods. Stated-preference research has improved methodologically and expanded dramatically. In these studies, researchers have explored many issues concerning the validity…

This article and the accompanying working paper[1] review the literature and develop recommendations for valuing mortality risk reductions in benefit-cost analyses that address low- and middle-income countries. Increasing life expectancy is a major goal of many policies implemented around the world. As a result, the value of reducing mortality risks has been extensively studied and several organizations have developed recommendations for estimating these values. However, both the recommendations and the underlying research primarily address high-income…

This article uses expert elicitation to address the monetary value of avoided premature mortality, which typically dominates the quantified benefits of air pollution regulations. Formal expert elicitation methods are one means of characterizing associated uncertainties. The authors undertake a pilot study that elicits quantitative probabilistic judgments of uncertainties in value per statistical life (VSL) estimates for use in an air pollution context. The two-stage elicitation addresses uncertainties in both a base case VSL for a…