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"Apparent" cost of a human life
Pradeep Indrakanti
Wednesday, 16 July 2008 07:07 UTC
I wrote a small article on my blog about this.
Are we taking lesser risks on the job in 2008, compared to 2003/4 ? Does dollar depreciation mean that employees are taking lesser risks to carry out their job functions? Why should the perceived value of a human life decrease with time? The world is currently enjoying record levels of overall prosperity, at any point in its history. The notion that a statistical human life is worth lesser now, compared to 2003/4 needs some explanation.
Updated 16 July 2008 16:21 UTC
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Replies
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Excellent post, Pradeep. I don’t think this implies reduced risk taking, though. What was the trend in fatalies in work-related incidents? Did that go down as well?
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I think the article said that the study was based on surveying the “risks” the employees took while carrying out their duties.
A more comprehensive explanation (from the Environmental Economics blog) is given below :
“Fortunately, these agencies do not merely pick their favorite number out of the air. Instead, the numbers are based on a wide variety of large-sample peer-reviewed statistical studies. These studies measure the tradeoffs that real people actually make, or claim that they would make, when they must decide whether to give up some money for an increased margin of safety. Each study produces a different estimate of people’s willingness to pay to reduce some specific mortality (death) risk. An average willingness to pay is desired, but each study has considered a different-sized risk reduction. It is not correct to average across “apples and oranges.” Thus it is typically assumed that willingness to pay is roughly proportional to the size of the risk reduction, at least over the policy-relevant range of small risk reductions.”
[ http://www.env-econ.net/2008/07/the-value-of-a.html ]
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