W. Kip Viscusi's research while affiliated with The Ave Maria School of Law and other places

Publications (405)

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This article outlines benefit-cost criteria for nudges and behavioral norms for a wide range of policy situations. The principal benefits from well-designed policies usually derive from promoting efficient behaviors, but counterpart costs may also be generated by discouraging efficient behaviors. The distinguishing economic characteristic of nudges...
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The Consumer Product Safety Commission’s regulation of disposable lighters was targeted at preventing injuries due to use of lighters by children not over 4 years of age. Based on a difference-in-differences analysis of national data for 1990–2019, this article estimates that the regulation reduced all injuries to the target population by 71%, burn...
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The U.S. Occupational Safety and Health Administration establishes incentives for safety by setting and enforcing regulatory standards. Using four and a half decades of inspection data, this article provides a comprehensive analysis of the factors underpinning penalties following fatalities. The “fatality premium” for regulatory violations followin...
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Background Public Health England has concluded that e-cigarettes are much safer than cigarettes for the user and for secondhand exposures, but it has not reached a definitive conclusion regarding pregnancy risks. How people perceive the risks to others is less well understood. Methods This study uses an online UK sample of 1041 adults to examine p...
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This article elicits information about risk perceptions and risk-risk tradeoffs for mass shootings and international terrorist attacks. These prominent public risks are similar in many respects in that both involve traumatic injuries. One might expect that the risk-risk tradeoff rate would be 1.0 unless other attributes of these risks are pertinent...
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The COVID‐19 pandemic poses novel health issues. However, the benefits and costs of the pandemic and policies to address it have a familiar economic structure. Chief among the health‐related benefits are the monetized values of the U.S. mortality costs of $3.9 trillion in 2020. The combined U.S. mortality and morbidity costs are $5.5–5.9 trillion....
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The value of a statistical life (VSL) establishes the money-risk tradeoff that U.S. government agencies have used for four decades to monetize the mortality reduction benefits of proposed regulations. This article advocates the adoption of the VSL more generally both for policy evaluation purposes and for setting the magnitude of regulatory sanctio...
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Consumers receive risk information about prescription drugs from many sources, including from largely unregulated attorney advertisements. This experiment measures subjective risk beliefs about prescription drugs and subjects’ drug-taking behavior in an incentivized setting. Results of the experiment are used to estimate a Bayesian learning model t...
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Policies to address the coronavirus disease 2019 (COVID-19) require a balancing of the health risk reductions and the costs of economic dislocations. Application of the value of a statistical life (VSL) to monetize COVID-19 deaths produces a U.S. mortality cost estimate of $1.4 trillion for deaths in the first half of 2020. This article presents wo...
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This article presents the first meta-analysis documenting the extent of publication selection biases in stated preference estimates of the value of a statistical life (VSL). Stated preference studies fail to overcome the publication biases that affect much of the VSL literature. Such biases account for approximately 90% of the mean value of publish...
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Low probability risks create challenges for individual decisions and potential pressures for government regulation. This article reports original survey evidence regarding the public’s perception and valuation of water-related risks from plastic bottles with bisphenol A, residues in drinking water of the herbicide atrazine, and trace amounts of pre...
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This paper updates the mortality cost of expenditures, which has relevance to a broad range of policies, including regulations, wars, and COVID‐19 restrictions. Because changes in income lead to changes in mortality risk, health investments costing more per life saved than a threshold cost‐per‐life‐saved cutoff level are expected to increase mortal...
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New national survey evidence on electronic cigarette (e-cigarette) risk beliefs indicates that people substantially overestimate the health risks posed by e-cigarettes, both in absolute terms and relative to conventional cigarette risk beliefs. Perceptions of the lung cancer risks and total mortality risks of conventional cigarettes function as pri...
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Will a major shock awaken the US citizens to the threat of catastrophic pandemic risk? Using a natural experiment administered both before and after the 2014 West African Ebola Outbreak, our evidence suggests “no.” Our results show that prior to the Ebola scare, the US citizens were relatively complacent and placed a low relative priority on public...
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This study examines how tort reform affects uncertainty in insurance markets by testing whether noneconomic damage caps influence reserving volatility for medical malpractice insurers. Using a panel of insurers from 1986 to 2009, we estimate the determinants of loss reserve error volatility and focus on how this volatility is influenced by the perc...
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While one might expect athletes to be strongly averse to extending their career too long when there is a chance of losing everything due to a concussion or a catastrophic injury, experimental subjects consistently played longer than the optimal amount for risk-neutral decisions. A commitment to the length of play in advance, as in the case of long-...
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The value of a statistical life (VSL) monetizes the expected loss in wellbeing associated with the risk of death. The utility loss resulting from a fatality is central to the empirical framework for estimating the VSL. The VSL trajectory over the life cycle exhibits an inverted-U shape, following a trajectory similar to that of lifetime patterns of...
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While recent research has shown that cannabis access laws can reduce the use of prescription opioids, the effect of these laws on opioid use is not well understood for all dimensions of use and for the general United States population. Analyzing a dataset of over 1.5 billion individual opioid prescriptions between 2011 and 2018, which were aggregat...
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With irreversible investments in safety, changes in workers’ compensation laws should affect employer incentives asymmetrically: increases in workers’ compensation generosity should cause employers to invest more in safety, but comparable decreases might not cause them to disinvest in existing precautionary programs or equipment. Although maximum w...
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Uncertain future risks pose cognitive and analytical challenges to household decision makers. Risks with uncertain probabilities, coupled with potentially severe outcomes pose problems for decision-making and are prone to overreactions. Imprecision in risk estimates generates behavioral distortions such as ambiguity aversion. This article presents...
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This symposium issue of the Journal of Risk and Uncertainty addresses wide-ranging policy issues pertaining to risk regulation and the economic underpinnings of these efforts. One such intervention consists of policies to address informational market failures. Whether new information has a positive value is less obvious than economists often assume...
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This article reviews economic evidence on health-dependent utility functions and presents new estimates of utility functions for cancer. Estimates of health-dependent utility functions have found that mild adverse health impacts can be treated as monetary equivalents. Severe health consequences also reduce utility levels but have an additional effe...
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Estimates of the costs of war include the financial costs and the lives that are lost. Using estimates of the value of a statistical life and the value of a statistical injury, the health losses can be converted to a common monetary metric and added to the budgetary costs. Counting the monetary value of the direct war-related fatalities and injurie...
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Based on case studies indicating that apologies from physicians to patients can promote healing, understanding, and dispute resolution, thirty-nine states (and the District of Columbia) have sought to reduce litigation and medical malpractice liability by enacting apology laws. Apology laws facilitate apologies by making them inadmissible as eviden...
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This article provides an experimental analysis of two-armed bandit problems that have a different structure in which the first unsuccessful outcome leads to termination of the game. It differs from a conventional two-armed bandit problem in that there is no opportunity to alter behavior after an unsuccessful outcome. Introducing the risk of death i...
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Examination of estimates of the income elasticity of the value of a statistical life based on international stated preference studies yields an average between 0.94 and 1.05 overall and 0.65 and 0.80 after controlling for covariates. Quantile regression estimates indicate that the income elasticity is about 0.55 for more affluent countries and 1.0...
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Government agencies throughout the world use the value of a statistical life (VSL) to monetise the mortality risk reduction benefits of government policies. The most reliable empirical estimates of the VSL using US labour market data are about US$10 million (year 2015 US dollars). Based on international estimates of the income elasticity of the VSL...
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Social norms are strongly associated with pro-environmental behaviors, but the evolution and dynamic effects of norms are less well understood. This article builds on the distinction of norms being descriptive, characterizing what people actually do, or injunctive, characterizing what people should do. It identifies four categories of norms with th...
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In this paper, we examine the influence of medical malpractice tort reform on the level of private health insurance company losses incurred. We employ a natural experiment framework centered on a series of tort reform measures enacted in Texas in 2003 that drastically altered the medical malpractice environment in the state. The results of a differ...
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Selection of the best estimates of economic parameters frequently relies on the “best estimates” or a meta-analysis of the “best set” of parameter estimates from the literature. Using an all-set dataset consisting of all reported estimates of the value of a statistical life (VSL) as well as a best-set sample of the best estimates from these studies...
Article
Single-stream recycling enables households to recycle an unsorted mix of cans, plastic, glass, and paper, thereby reducing recycling costs. The expansion of single-stream recycling in Wisconsin provides a natural experiment to assess the extent to which single-stream increases recycling behavior. Using a longitudinal database that matches household...
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Regulatory impact analyses (RIAs) weigh the benefits of regulations against the burdens they impose and are invaluable tools for informing decision makers. We offer 10 tips for nonspecialist policymakers and interested stakeholders who will be reading RIAs as consumers. 1. Core problem: Determine whether the RIA identifies the core problem (compell...
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Countries throughout the world use estimates of the value of a statistical life (VSL) to monetize fatality risks in benefit-cost analyses. However, the vast majority of countries lack reliable revealed preference or stated preference estimates of the VSL. This article proposes that the best way to calculate a population-average VSL for countries wi...
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State punitive damages reforms have altered how courts award punitive damages. We model the decision to award punitive damages as a two-step process involving the decision to award any punitive damages and the decision of what amount to award. Using samples of trial court verdicts from the Civil Justice Survey of State Courts, we find that punitive...
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U.S. labor market estimates of the value of a statistical life (VSL) were the first revealed preference estimates of the VSL in the literature and continue to constitute the majority of such market estimates. The VSL estimates in U.S. studies consequently may have established a reference point for the estimates that researchers analyzing data from...
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A review of my research collaborations indicates that the principal motivations for coauthoring were the large scale of the project, the necessity of drawing on different economics skills, the involvement of researchers from other disciplines, and the training of graduate students. The summary statistics of my article collaborations indicate six co...
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Recollection bias is the phenomenon whereby people who observe a highly unexpected event hold current risk beliefs about a similar event that are no higher than their recollection of their prior beliefs. This article replicates and extends the authors' previous study of recollection bias in relation to individuals' perceptions of the risks of terro...
Article
Selection of the best estimates of economic parameters frequently relies on the best estimate or a meta-analysis of the “best-set” of parameter estimates from the literature. Using an all-set dataset consisting of all reported estimates of the value of a statistical life (VSL) as well as a best-set sample of the best estimates from these studies, t...
Article
U.S. labor market estimates of the value of a statistical life (VSL) were the first revealed preference estimates of the VSL in the literature and continue to constitute the majority of such market estimates. The VSL estimates in U.S. studies consequently may have established a reference point for the estimates that researchers analyzing data from...
Chapter
The economic approach to valuing risks to life focuses on risk–money trade-offs for very small risks of death, or the value of statistical life (VSL). These VSL levels will generally exceed the optimal insurance amounts. A substantial literature has estimated the wage–fatality risk trade-offs, implying a median VSL of $7 million for US workers. Int...
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Although benefit assessment principles are well established for specific populations, very little attention has been paid to how to define the scope of the pertinent population for such assessments. Whose social welfare matters and whose benefits should be included in the assessment? Should there be any linkage between the benefits and the politica...
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This article evaluates the interdependence of medical malpractice insurance markets and health insurance markets. Prior research has addressed the performance of these markets, individually, without specifically quantifying the extent to which they are linked. Increasing levels of health insurance losses could increase the scale of potential malpra...
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Drawing on evidence from a new nationally representative survey, this article examines several measures of risk beliefs for e-cigarettes. For both lung cancer mortality risks and total smoking mortality risks, respondents believe that e-cigarettes pose risks that are lower than the risks of conventional tobacco cigarettes. However, people greatly o...
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Behavioral economists have identified certain biases in decision making that lead people to make decisions that harm themselves, but there is insufficient guidance for estimating benefits in the presence of such behavioral failures. This gap in principles and standards for benefit-cost analysis has led government agencies at times to adopt arbitrar...
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![Figure][1] Cost-effective emissions controls depend on calculating the domestic and global social costs of carbon. PHOTO: © IMAGINECHINA/CORBIS The National Academies of Sciences have assembled a committee to review the economic aspects of climate change in order to better estimate the
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The fatality risk-money tradeoff that is the value of a statistical life (VSL) may vary with the nature of the fatality event. While all fatalities involve loss of future life expectancy, the morbidity effects and their duration may differ. This article analyzes fatality risks accompanied by morbidity effects of different duration to disentangle th...
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State punitive damages reforms have altered how courts award punitive damages. We model the decision to award punitive damages as a two-step process involving the decision to award any punitive damages and the decision of what amount to award. For the Civil Justice Survey of State Courts samples of trial court verdicts, punitive damages caps reduce...
Article
Single-stream recycling enables households to recycle an unsorted mix of cans, plastic, glass, and paper, thereby reducing recycling costs. The expansion of single-stream recycling in Wisconsin provides a natural experiment to assess the extent to which single-stream increases recycling behavior. Using a longitudinal database that matches household...
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State apology laws offer a separate avenue from traditional damages-centric tort reforms to promote communication between physicians and patients and to address potential medical malpractice liability. These laws facilitate apologies from physicians by excluding statements of apology from malpractice trials. Using a unique dataset that includes all...
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Meta-regression estimates of the value of a statistical life (VSL) controlling for publication selection bias often yield bias-corrected estimates of VSL that are substantially below the mean VSL estimates. Labor market studies using the more recent Census of Fatal Occupational Injuries (CFOI) data are subject to less measurement error and also yie...
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Policy applications of the value of a statistical life (VSL) often make a benefits transfer assumption that the VSL from one market context is broadly applicable to other contexts. The U.S. Department of Transportation’s estimate of $9.2 million is based on labor market estimates of VSL. This article examines whether there are any significant diffe...
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The US Food and Drug Administration (FDA) balances risks and benefits before approving pharmaceuticals. But powerful behavioral biases that lead to the mishandling of uncertainty also influence its approval process. The FDA places inordinate emphasis on errors of commission versus those of omission, a bias that is compounded by its desire to avoid...
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The value of a statistical life (VSL) is the most influential single parameter used in calculating the benefits of governmental regulations. While there are some interagency differences, there is a commonality in the conceptual approach, the central role of mortality risk valuation in benefit assessment, and the general range of valuations used. Co...
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The 2014 GM ignition-switch recall highlighted the inadequacies of the company's safety culture and the shortcomings of regulatory sanctions. The company's inattention to systematic thinking about product safety can be traced to the hostile treatment of corporate risk analyses by the courts. This Article proposes that companies should place a great...
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Willingness-to-pay (WTP) values and willingness-to-accept (WTA) values have received considerable attention, but the role of reference-dependence effects is more diverse. Policies involving cost and risk may have reference point effects with respect to both cost and risk, leading to four potential valuation measures. Experimental evidence for water...
Article
Recollection bias is a phenomenon whereby people, after observing a highly unexpected event, hold current risk beliefs about a similar event that are no higher than their recollection of their prior beliefs. This article explores the phenomenon of recollection bias with respect to individuals’ perceptions of the risks of terrorism attacks. Over 60%...
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Although government agencies increasingly use behavioral irrationalities as a justification for government intervention, the paradox is that these same government policies are also subject to similar behavioral inadequacies across a broad range of policies. This article develops an analysis of behavioral public choice in which we recognize that gov...
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Environmental risks may comprise the most important policy-related application of the economics of risk and uncertainty. Many biases in risk assessment and regulation, such as the conservatism bias in risk assessment and the stringent regulation of synthetic chemicals, reflect a form of ambiguity aversion. Nevertheless, there is evidence that peopl...
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The value of risks to life as measured by the risk-money trade-off plays a fundamental role in economic analyses of health and safety risks and serves as the principal benefit measure for government risk regulation policies. The hedonic models that have been employed to generate empirical estimates of the value of statistical life (VSL) have produc...
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This article examines evidence for the private rationality of decisions to choose bottled water using a large, nationally representative sample. Consumers are more likely to believe that bottled water is safer or tastes better if they have had adverse experiences with tap water or live in states with more prevalent violations of EPA water quality s...
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We find “green” labels increase residential property values by an average of 5%. This premium varies by label stringency and across market segments. Builders respond to the stringency of labels by strategically incorporating green features to achieve higher ratings. This strategy seems reasonable as there is no market premium for green features tha...
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Direct experiences, we find, influence environmental risk beliefs more than the indirect experiences derived from outcomes to others. This disparity could have a rational basis. Or it could be based on behavioral proclivities in accord with the well-established availability heuristic or the vested-interest heuristic, which we introduce in this arti...
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The distribution of blockbuster punitive damages awards has fat tails similar to the distributions of losses from natural disasters. Extremely large awards occur more often and are more difficult to predict than if blockbuster awards were distributed normally. The size and predictability of awards are important factors in the U.S. Supreme Court's d...
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This article estimates whether there is a cancer risk premium for the value of a statistical life using stated preference valuations of cancer risks for a large, nationally representative US sample. The present value of an expected cancer case that occurs after a one decade latency period is $10.85m, consistent with a cancer premium that is 21% gre...
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This paper examines household recycling participation by state among panelists in a large nationally representative internet survey panel.We report the percent of panelists in each state who indicate household recycling of cans, plastic, paper, or glass in the previous twelve months. These data come from over 300,000 surveys, administered starting...
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Estimates of the value of a statistical life (VSL) establish the price government agencies use to value fatality risks. Transferring these valuations to other populations often utilizes the income elasticity of the VSL, which typically draw on estimates from meta-analyses. Using a data set consisting of 101 estimates of the income elasticity of VSL...
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The advent of the Census of Fatal Occupational Injuries has enabled researchers to reduce measurement error in fatality rate estimates; in turn, estimates of the "value of a statistical life" that are based on labor market data have become less uncertain.
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Value of life issues traditionally pertain to insurance of the losses of accident victims, for which replacement of the economic loss is often an appropriate concept. Deterrence measures of the value of life focus on risk-money tradeoffs involving small changes in risk. Using market data for risky jobs and product risk contexts often yields substan...
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Information disclosure policies represent an additional policy mechanism that can be used to foster reductions in greenhouse gas emissions. These informational efforts could be either mandatory or voluntary, but in each case government regulation could play a productive role by establishing common structures for the information and providing criter...
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This article uses a large, original data set on U.S. recycling behavior and perception of social norms. The data include unique information with respect to personal norms and external social norms with respect to recycling behavior, making it possible to analyze the determinants of these norms and the effect of norms on recycling. The legal and reg...

Citations

... 27 Similarly, the global economic burden of epilepsy − which primarily affects children and adults over the age of 65 years − was estimated to be $647.4 billion in 2016, while the global economic burden of COVID-19 deaths in 2020 was estimated to be $10.1 trillion. 39,40 Our findings have important policy implications. If the health burden of ADRDs continued to grow at its current pace, it would not only impose a large formal and informal care cost burden, but also a large economic burden when measured in terms of the value of DALYs lost. ...
... Kochi, Hubbell, and Kramer (2006) show that the VSL estimates from SP methods are significantly lower than the VSL estimates obtained from RP methods. Also, Masterman and Viscusi (2020), using a meta-analysis, show that SP VSL estimations suffer from publication selection bias leading to an overestimation of the VSL closed to 90%. ...
... Like the cost of public policies that threaten human lives, the cost of crime depends on the cost of human life. Largely to inform necessary public policy decisions (Viscusi 2021), there is a sizable literature on the value of unidentified or "statistical" lives that applies similarly to the value of lives lost to crime. We know that statistical lives have finite value because individuals and policymakers routinely make decisions that have finite benefits and involve risk to life. ...
... Others posit that the measure is affected by biases and is not accurate when foregoing the difference in occupation, industry, age, and cohort group (Aldy and Viscusi 2008;Viscusi 2004;Viscusi 2018a, b). Although these concerns were addressed recently by Viscusi (2020) and more specifically when attempting to personalize the VSL levels to the circumstances of the individuals under study, Viscusi argues that the adoption of an average VSL that does not account for differences in age and income using the adjustments proposed in his paper represents a departure from strict efficiency guidelines in that it incorporates equity concerns (Viscusi 2020). ...
... Vaping Discussion on News Media Most research around news media and vaping centered on responses to the 2020 outbreak of vaping-related lung injury (EVALI) [22]. Generally, research articles on vaping in news media tend to frame vaping as a risk [29], possibly reducing youth health outcomes. A study found that the outbreak of EVALI was related to increased news coverage about the dangers of vaping and internet searches for vaping cessation [18]. ...
... These differences could be due to the level of income of the country where the disaster occurred [40]. The method of calculation could be another reason for such differences, for example, as consumers optimize their lifetime utility, thus neglecting intergenerational (long-term) utility, using willingness to pay (WTP) methods for a reduction of risk can often lead to overestimated values [44,45]. It could also simply be due to the differences in cultural norms between countries [40]. ...
... Unfortunately, in many societies the problem is compounded by individuals placing a low priority on public spending to prepare for a pandemic disease (Pike et al., 2020). In a survey of U.S. citizens, Pike et al. (2020) asked respondents to value fatalities before and immediately after the highly visible 2014 West African Ebola Outbreak, relative to deaths from environmental disaster risks and/or a terrorist attack. ...
... First, our results indicate there was a substantial increase in the number of firearm incidents in the 69 weeks (17 months) following the high-profile violent police incident in Minneapolis. Second, it is estimated that from 2015 to 2018, the government paid over 39 billion dollars to victims or their families due to police violence [25]. Similarly, it is estimated that firearm violence costs federal, state, and local governments over 34 million dollars a day in social costs [26]. ...
... Similarly, Smart (2015) argues that greater cannabis access decreases traffic crash mortality in the aggregate but increases traffic fatalities caused by drivers aged 15-20 who cannot drink alcohol legally. In addition to alcohol, recent literature also suggests a substitution effect between cannabis and opioids (McMichael et al., 2020;Powell et al., 2018). Kim et al. (2016) find reductions in opioid-positive test rates of deceased drivers following the implementation of medical cannabis laws. ...
... However, the WTP levels that respondents express are unduly large given the magnitude of the hazards. We propose that these excessive valuations reflect the cognitive challenges of formulating reliable valuations when dealing with risks that combine low probabilities with substantial ambiguity regarding the magnitude of the risk (Dudley et al., 2019;Viscusi et al., 2019). ...