Scandinavian Working Papers in Business Administration
Working Papers,
Örebro University, School of Business
No 2010:14: The Economic Value of Preventing Fatalities: Recent evidence on the value of a statistical life in Sweden
Lars Hultkrantz () and Mikael Svensson ()
Additional contact information
Lars Hultkrantz: Department of Business, Economics, Statistics and Informatics, Postal: Örebro University, Swedish Business School, SE - 701 82 ÖREBRO, Sweden
Mikael Svensson: Department of Business, Economics, Statistics and Informatics, Postal: Örebro University, Swedish Business School, SE - 701 82 ÖREBRO, Sweden
Abstract:
Aims: This paper briefly reviews the theoretical and empirical foundation for the economic valuation of preventing fatalities, referred to as the value of a statistical life (VSL), and summarizes recent published empirical evidence on VSL in Sweden.
Methods: Literature searches were conducted in Econlit, Pubmed, Google Scholar and in bibliographies of published papers.
Results: A total of nine published papers on the value of preventing fatalities in Sweden where identified since year 2000. Most studies have been conducted in a road-safety context, which may be explained by the widespread use of economic evaluations in this sector. Preferred policy estimates of the value of a statistical life in the road sector ranges from 13 to 57 million Swedish kronor (€1.4 to €6.1 million). Currently, official authorities in Sweden recommend a VSL of 22 million Swedish kronor (€2.4 million).
Conclusion: In order to conduct an economic evaluation of a life-saving intervention it is necessary to have an explicit economic value of a prevented fatality. Empirical research on Swedish data suggests that an appropriate value is in the range of 13 to 57 million Swedish kronor (€1.4 to €6.1 million).
Keywords: Willingness to pay; Value of a statistical life; Stated Preferences; Revealed Preferences; Economic Evaluation
15 pages, October 14, 2010
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