The value of a statistical life under changes in ambiguity

Bleichrodt, Han (Erasmus School of Economics, Rotterdam, The Netherlands ; Australian National University, Canberra, Australia) ; Courbage, Christophe (Haute école de gestion de Genève, HES-SO // Haute Ecole Spécialisée de Suisse Occidentale) ; Rey, Béatrice (Université Lumière Lyon 2, Ecully, France)

The value of a statistical life (VSL) is a key parameter in the analysis of government policy. Most policy decisions are made under ambiguity. This paper studies the effect of changes in ambiguity perception on the VSL. We propose a definition of increases in ambiguity perception based on Ekern’s (1980) definition of increases in risk. Ambiguity aversion alone is not sufficient to lead to an increase in the VSL when the decision maker perceives more ambiguity. Our results highlight the importance of higher order ambiguity attitudes, particularly ambiguity prudence.


Keywords:
Article Type:
scientifique
Faculty:
Economie et Services
School:
HEG - Genève
Institute:
CRAG - Centre de Recherche Appliquée en Gestion
Subject(s):
Economie/gestion
Date:
2019-04
Pagination:
15 p.
Published in:
Journal of risk and uncertainty
Numeration (vol. no.):
2019, vol. 58, no. 1, pp. 1-15
DOI:
ISSN:
0895-5646
Appears in Collection:



 Record created 2019-05-08, last modified 2019-05-14

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