What is YOUR LIFE worth to the Dept of Transportation? About 2.7 Million.
This cost allocation study Notes that the EPA is willing to spend almost twice what the Dept of Transportation is willing to spend to keep YOU alive. The numbers seem old so there may be some adjustments, but interesting is this:
In policy and regulatory analyses, EPA uses a value of $4.8 million to represent the cost of a premature death. This value is the mean of estimates from 26 studies dating back to the mid 1970s that have attempted to place a value on the cost of premature deaths. Estimates from those studies range from $0.6 million to $13.5 million, reflecting the large uncertainties in trying to estimate the public's willingness to pay to avoid premature death.
The Department of Transportation has adopted a value of $2.7 million per premature death, based on a comprehensive 1991 study by the Urban Institute
People are reluctant to accept this type of "dollar valuation" analysis even though it's commonplace in legal settlements and is a VERY APPROPRIATE way to allocate public funds. Note that the 4.8 million dollars the EPA spends to save a life would save thousands of lives if spent in alternative ways. One can argue that the complexity of this type of analysis undermines the rationale behind using this "lives for dollars" game, but it's a weak argument. Yet even with this appropriate method of trying to allocate dollars to lives and then allocate them most effectively, we tend to apply funding in odd ways and squander billions due to political budgeting.
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[...] MORE: Here’s more data including a study (see left side of page) that suggests over 12,000 deaths from US state’s failures in more aggressively implementing seat belt laws. If we assume these folks are worth 2.7 million each as the transportation department likes to do, then in simple terms it would have been worth 12000 x 2.7 million = 32.4 billion dollars to prevent these deaths. Assuming EPA’s higher value of life number we get even more life bang from our bucks by getting people to buckle up, which is one of the cheapest ways to save lives. The cheapest of all for USA life saving, if I recall correctly from a study printed in the book “The Skeptical Environmentalist”, is increasing the use/quality of smoke detectors in buildings and homes. For life saving on a global scale I think it’s oral rehydration therapy or mosquito nets, which at .15 per dose / 2.50 per net are quite the deal if you see *human life* as the thing we should be optimizing for as we allocate limited resources to big problems. [...]
Pingback by Joe Duck » Kids, cars, costs, and risks | August 17, 2006 |
[...] if this extra cost makes sense we could use the value of an American life according to the Dept of Transportation, about 2.7 million, and try to answer this [...]
Pingback by Wagner Street, Talent Oregon « Joe Duck | May 11, 2007 |
[...] all the time when deciding how much to spend on safety / health / etc. In those calculations lives in the USA are each worth about two to five million dollars. It’s about time we started publishing a lot more information about the rationale for [...]
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