Rates of time preference and valuations of the duration of life

W. Kip Viscusi*, Michael J. Moore

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

109 Scopus citations

Abstract

This paper develops a multi-period Markov model of the lifetime choice of occupational fatality risks. The empirical model analyzes the wage effects of job risks using the 1982 University of Michigan Panel Study of Income Dynamics in conjunction with death statistics from the U.S. National Traumatic Occupational Fatality Survey. Evidence regarding workers' intertemporal choices with respect to risks with long-term implications is broadly consistent with rational behavior. Workers' implicit real rate of time preference with respect to future life years equals approximately 11 percent. This rate of time preference decreases with education.

Original languageEnglish (US)
Pages (from-to)297-317
Number of pages21
JournalJournal of Public Economics
Volume38
Issue number3
DOIs
StatePublished - Apr 1989

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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