Using the Value of a Statistical Life to Measure the Benefit from the Clean Air Act: Comment

Jon R. Neill ()
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Jon R. Neill: Western Michigan University

Atlantic Economic Journal, 2024, vol. 52, issue 1, No 5, 39-44

Abstract: Abstract The benefit-cost study of the Clean Air Act conducted by the EPA a decade ago found that the benefit from that act far exceeds its cost. However, 85% of that benefit came from the EPA's valuation of the lives saved by the act. This valuation was based on estimates of the statistical value of a life, the majority of which were made using a hedonic wage equation. The analysis presented here shows that such a valuation may not accurately capture willingness to pay for improved air quality. In fact, it is only capable of doing so in a very special case, when air quality does not affect the probability of developing non-fatal conditions.

Keywords: Statistical value of a life; Hedonic equations; Willingness to pay; D61; Q51 (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s11293-024-09796-x

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