PUBLICATIONS, Research ReportsIs the Value of Statistical Life Sensitive to the Choice of Measure? Evidence from Transportation Accident and Cancer Risks in Vietnam Posted on 4 January, 202114 January, 2021 by researchBy Nguyen Tuan Kiet, Jack Knetsch Summary: This research tested for possible differences between WTA and WTP estimates of VSL, for changes in both risks of cancer and transportation deaths. A total of 1,100 respondents residing in Can Tho City were randomly surveyed. The results show that WTA-based VSL estimates are about five to six times larger than WTP-based VSL estimates. While showing large differences, these differences may be due not only to the disparity in valuations of gains and losses, but also to the influence of the asymmetric impact of an income or wealth constraint that limits the sums that individuals can pay in the WTA measure while imposing no restraint on the sums people can demand to accept a loss. A further bounded non-monetary scale was used to test for differences between the two valuations in the absence of any wealth constraint. The results were fully consistent with the observed disparity in the monetary evaluations. These results point to the likelihood of a serious bias in many current VSL estimates that ignore the impact of the widely observed valuation disparity, and to the need to better determine instances in which the WTA is the more appropriate measure and those in which the more traditional WTP measure is the better choice. Research Report: DownloadCountry: VietnamPublication Year: 2017Research Areas: Behavioral Economics & Social CapitalResearch Topic: Adaptation practices/projectsAnalytical Framework: Behavioral/Experimental Economics Valuing the Protection Service Provided by Mangroves in Typhoon-hit Areas in the PhilippinesMangrove and Shrimp Farming Profitability in the Mekong River Delta, Vietnam
Summary: This research tested for possible differences between WTA and WTP estimates of VSL, for changes in both risks of cancer and transportation deaths. A total of 1,100 respondents residing in Can Tho City were randomly surveyed. The results show that WTA-based VSL estimates are about five to six times larger than WTP-based VSL estimates. While showing large differences, these differences may be due not only to the disparity in valuations of gains and losses, but also to the influence of the asymmetric impact of an income or wealth constraint that limits the sums that individuals can pay in the WTA measure while imposing no restraint on the sums people can demand to accept a loss. A further bounded non-monetary scale was used to test for differences between the two valuations in the absence of any wealth constraint. The results were fully consistent with the observed disparity in the monetary evaluations. These results point to the likelihood of a serious bias in many current VSL estimates that ignore the impact of the widely observed valuation disparity, and to the need to better determine instances in which the WTA is the more appropriate measure and those in which the more traditional WTP measure is the better choice.