THE QUANTITY‐ADJUSTED VALUE OF LIFE

Michael J. Moore*, W. Kip Viscusi

*Corresponding author for this work

Research output: Contribution to journalArticle

141 Scopus citations

Abstract

The traditional compensating differential analysis is extended to reflect the effects on wages of the duration of life at risk and of insurance benefits to the surviving spouse and dependents. The implicit discount rate that workers use in making their life‐cycle employment decisions is also estimated. The revealed discount rate ranges from 10 to 12 percent, and the implicit value per year of life is 175,000. There is also evidence of significant wage reductions resulting from higher workers' compensation benefits for fatal and nonfatal injuries, suggesting an important tradeoff between ex ante and ex post compensation for risk.

Original languageEnglish (US)
Pages (from-to)369-388
Number of pages20
JournalEconomic Inquiry
Volume26
Issue number3
DOIs
StatePublished - Jul 1988

ASJC Scopus subject areas

  • Business, Management and Accounting(all)
  • Economics and Econometrics

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