Willingness to pay estimates for wildfire smoke health impacts in the US using the life satisfaction approach

Benjamin Jones

Journal of Environmental Economics and Policy, 2018, vol. 7, issue 4, 403-419

Abstract: Wildfire smoke is harmful to human health, imposing economic costs on society. Understanding wildfire smoke health costs is increasingly important in evaluating the true burden of wildfire on society, including the difficult to measure individual-level costs of smoke exposure. However, extant research on the individual-level health damages of smoke exposure are based on geographically limited case studies and make strong assumptions on agent rationality and the functioning of markets. Given that US wildfire policy is often set at the national-level, more representative estimates based on weaker and more realistic assumptions are needed. In this paper, the life satisfaction approach is applied for the first time to estimate willingness to pay (WTP) to avoid wildfire smoke induced health effects. Using nationally-representative data from the US Behavioral Risk Factor Surveillance System over 2006–2010, we estimate that US adults have a WTP of $129 [95% CI: $23, $235] to avoid one day of wildfire smoke induced health effects. WTP is largest for young adults (18–24 years) and among urban residents. The baseline WTP result is larger than the only other comparable extant estimate, suggestive that health damages may vary both geographically and according to the set of assumptions made on exposed individuals’ behavior.

Date: 2018
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DOI: 10.1080/21606544.2018.1463872

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