Statistical vs. Identified Lives in Benefit-Cost Analysis PDF Download
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Author: James K. Hammitt
Publisher:
ISBN:
Category :
Languages : en
Pages : 30
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Book Description
Economic evaluation of projects involving changes in mortality risk conventionally assumes that lives are statistical, i.e., that risks and policy-induced changes in risk are small and similar among a population. In reality, baseline mortality risks and policy-induced changes in risk often differ among individuals although these differences are imperfectly known. We examine the effects of information about heterogeneity of risk on economic evaluation. Although social welfare (defined as aggregate expected utility) is unaffected by information about risk heterogeneity, the economic valuation of changes in risk (the sum of individual compensating or equivalent variations) is sensitive to this information. The effect of information on economic valuation and hence the outcome of a benefit-cost analysis (BCA) depends on: i) whether information is about heterogeneity of the baseline and/or change in risk, ii) whether risk is valued using willingness to pay (WTP) or willingness to accept (WTA) measures, iii) the status quo policy, and iv) whether individuals are risk-averse or risk-neutral in wealth. We show that BCA does not systematically favor identified over statistical lives and suggest some political factors that may explain the apparent public-decision bias toward protecting identified lives.
Author: James K. Hammitt
Publisher:
ISBN:
Category :
Languages : en
Pages : 30
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Book Description
Economic evaluation of projects involving changes in mortality risk conventionally assumes that lives are statistical, i.e., that risks and policy-induced changes in risk are small and similar among a population. In reality, baseline mortality risks and policy-induced changes in risk often differ among individuals although these differences are imperfectly known. We examine the effects of information about heterogeneity of risk on economic evaluation. Although social welfare (defined as aggregate expected utility) is unaffected by information about risk heterogeneity, the economic valuation of changes in risk (the sum of individual compensating or equivalent variations) is sensitive to this information. The effect of information on economic valuation and hence the outcome of a benefit-cost analysis (BCA) depends on: i) whether information is about heterogeneity of the baseline and/or change in risk, ii) whether risk is valued using willingness to pay (WTP) or willingness to accept (WTA) measures, iii) the status quo policy, and iv) whether individuals are risk-averse or risk-neutral in wealth. We show that BCA does not systematically favor identified over statistical lives and suggest some political factors that may explain the apparent public-decision bias toward protecting identified lives.
Author:
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
Author:
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Author: I. Glenn Cohen
Publisher: Oxford University Press
ISBN: 0190217499
Category : Medical
Languages : en
Pages : 241
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Book Description
The identified lives effect describes the fact that people demonstrate a stronger inclination to assist persons and groups identified as at high risk of great harm than those who will or already suffer similar harm, but endure unidentified. As a result of this effect, we allocate resources reactively rather than proactively, prioritizing treatment over prevention. For example, during the August 2010 gold mine cave-in in Chile, where ten to twenty million dollars was spent by the Chilean government to rescue the 33 miners trapped underground. Rather than address the many, more cost effective mine safety measures that should have been implemented, the Chilean government and international donors concentrated efforts in large-scale missions that concerned only the specific group. Such bias as illustrated through this incident raises practical and ethical questions that extend to almost every aspect of human life and politics. What can social and cognitive sciences teach us about the origin and triggers of the effect? Philosophically and ethically, is the effect a "bias" to be eliminated or is it morally justified? What implications does the effect have for health care, law, the environment and other practice domains? This volume is the first to take an interdisciplinary approach toward answering this issue of identified versus statistical lives by considering a variety of perspectives from psychology, public health, law, ethics, and public policy.
Author: Marquez
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
The author studies three aspects of human live valuation and its relation with cost benefit analysis and regulation. More precisely the author addresses the problem of valuation of a statistical human life and its relation with cost benefit analysis in mortality risk reduction. First, studies the debate about Valuation of a Statistical Human Life (VSL) and Cost- Benefit Analysis (CBA) in mortality risks regulation; second, deals with two challenges to CBA and VSL, these are (a) the problem of discount rates and the problem of (dis)counting of future human lives, and (b), tests if culture (represented as a set of values) has an incidence in risk preferences and therefore, in willingness to pay for life in different countries.
Author: E.J. Mishan
Publisher: Routledge
ISBN: 1351029770
Category : Business & Economics
Languages : en
Pages : 405
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Book Description
Cost-benefit analysis (CBA) is the systematic and analytical process of comparing benefits and costs in evaluating the desirability of a project or programme – often of a social nature. It attempts to answer such questions as whether a proposed project is worthwhile, the optimal scale of a proposed project and the relevant constraints. CBA is fundamental to government decision making and is established as a formal technique for making informed decisions on the use of society’s scarce resources. This timely sixth edition of the classic Cost-Benefit Analysis text continues to build on the successful approach of previous editions, with lucid explanation of key ideas, simple but effective expository short chapters and an appendix on various useful statistical and mathematical concepts and derivatives. The book examines important developments in the discipline, with relevant examples and illustrations as well as new and expanded chapters which build upon standard materials on CBA. Highlights include: updated historical background of CBA extended non-market goods valuation methods the impact of uncertainty evaluation of programmes and services behavioural economics decision rules and heuristics CBA and regulatory reforms CBA in developed and developing countries value of household production other topics frequently encountered in CBA, such as costs of diseases and air pollution, and value of statistical life. This book is a valuable source and guide to international funding agencies, governments, interested professional economists and senior undergraduate and graduate students. The text is fully supported by a companion website, which includes discussion questions and PowerPoint slides for each chapter.
Author: W. Kip Viscusi
Publisher: Oxford University Press, USA
ISBN: 0195102932
Category : Decision-making
Languages : en
Pages : 321
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Book Description
Examining issues related to the social regulation of risk, this volume contains essays on the value of life, empirical estimates of the value of life, the rationality of individual responses to risk, the effect of government risk regulation efforts, and the role of the courts and insurance.
Author: Anthony E. Boardman
Publisher: Cambridge University Press
ISBN: 1108415997
Category : Business & Economics
Languages : en
Pages : 605
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Book Description
A comprehensive and authoritative introduction to cost-benefit analysis that aims to be readable and user-friendly.
Author: Peter G. Sassone
Publisher:
ISBN: 9780126193503
Category : Business & Economics
Languages : en
Pages : 204
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Book Description
Textbook on the theory and methodology of cost benefit analysis - covers criteria for decision making, shadow pricing, discount rate, etc. Bibliography pp. 175 to 177, graphs and statistical tables.
Author: Scott Farrow
Publisher: Edward Elgar Publishing
ISBN: 1782549064
Category : Business & Economics
Languages : en
Pages : 465
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Book Description
'This book is a superb textbook treatment of benefit–cost analysis. It is well designed for students in public policy, public administration, public health, social work, environmental affairs, law and business.' – John D. Graham, Indiana University, US 'Principles and Standards for Benefit–Cost Analysis is well worth reading. The volume reproduces some chapters previously published online in the Journal of Benefit–Cost Analysis alongside new material that has not yet appeared in print, and does so in a logical and appealing way. Even the several chapters with which I disagreed made me think hard about my own views. And thinking hard is a good thing!' – Paul R. Portney, University of Arizona, US Benefit–cost analysis informs which policies or programs most benefit society when implemented by governments and institutions around the world. This volume brings together leading researchers and practitioners to recommend strategies and standards to improve the consistency and credibility of such analyses, assisting analysts of all types in achieving a greater uniformity of practice. Although new analytical approaches are constantly being used and tested, this book supports the emergence of a professional culture adhering to a set of principles and standards that can be used to identify useful analytical processes and to discard less useful ones. Contributors to this volume come from a wide variety of backgrounds and include authors of leading textbooks, editors of journals, former government officials, and practitioners whose analyses have shaped decisions about education, the environment, security, income distribution, and other vital social and economic policies. Students and professors of public sector economics will find much of interest in this groundbreaking book. Practitioners working in government, non-profit organizations, and international institutions, including welfare economists, policy analysts, environmentalists, engineers, and others will also benefit from this volume's sophisticated and practical recommendations.
