Paper Number: 2018-01
Document Date: 4/2018
Author(s): Chris Dockins, Kelly B. Maguire, Steve Newbold, Nathalie B. Simon, Alan Krupnick, Laura O. Taylor
Subject Area(s): Valuation, Benefit-Cost Analysis
J17 - Value of Life; Foregone Income
Q51 - Valuation of Environmental Effects
Keywords: value of statistical life, mortality risk valuation, terminology, focus group
Abstract: Benefit-cost analyses of environmental, health, and safety regulations often rely on an estimate of the “value of statistical life,” or VSL, to calculate the aggregate benefits of human mortality risk reductions in monetary terms. The VSL represents the marginal rate of substitution between mortality risk and money, and while well-understood by economists, to many non-economists, decision-makers, media professionals, and others, the term resembles obfuscated jargon bordering on the immoral. This paper describes a series of seven focus groups in which we applied a systematic approach for identifying and testing alternatives to the VSL terminology. Our objective was to identify a term that better communicates the VSL concept. Specifically, a list of 17 alternatives to the VSL term was developed and tested in focus groups that culminated in a formal ranking exercise. Using a round-robin tournament approach to analyze the data, and our qualitative judgments, we identify “value of reduced mortality risk” as the dominant replacement term among the alternatives tested.
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