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Are some lives more valuable? An ethical preferences approach

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  • Johansson-Stenman, Olof
  • Martinsson, Peter

Abstract

We develop a theoretical model of the ethical preferences of individuals, combining individual social welfare functions and random utility theory. The model is applied by conducting a choice experiment regarding safety-enhancing road investments that target different age groups and road user types. The relative value of a saved life is found to decrease with age, such that the present value of a saved life-year is almost independent of age at a pure rate of time preference of a few percent. Moreover, a saved pedestrian is consistently valued higher than a saved car driver of the same age.

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  • Johansson-Stenman, Olof & Martinsson, Peter, 2008. "Are some lives more valuable? An ethical preferences approach," Journal of Health Economics, Elsevier, vol. 27(3), pages 739-752, May.
    • Handle: RePEc:eee:jhecon:v:27:y:2008:i:3:p:739-752
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