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{{Short description|Economic value}}

The '''value of life''' is an economic [[value theory|value]] used to quantify the benefit of avoiding a fatality.<ref name="DPMC" /> It is also referred to as the '''cost of life''', '''value of preventing a fatality''' ('''VPF'''), '''implied cost of averting a fatality''' ('''ICAF'''), and '''value of a statistical life''' ('''VSL'''). In [[social science|social]] and [[political science]]s, it is the [[marginal cost]] of death prevention in a certain class of circumstances. In many studies the value also includes the quality of life, the expected life time remaining, as well as the earning potential of a given person especially for an after-the-fact payment in a [[wrongful death claim]] [[lawsuit]].

As such, it is a statistical term, the value of reducing the [[average]] number of deaths by one. It is an important issue in a wide range of disciplines including [[economics]], [[health care]], [[adoption]], [[political economy]], [[insurance]], [[worker safety]], [[environmental impact assessment]], [[globalization]],<ref name="Miller" /> and [[process safety]].<ref name=":4">{{Cite book |last1=Franks |first1=Andrew |title=Application of QRA in Operational Safety Issues |last2=Whitehead |first2=Richard |last3=Crossthwaite |first3=Phil |last4=Small |first4=Louise |publisher=[[Health and Safety Executive|HSE Books]] |year=2002 |isbn=0-7176-2570-2 |series=Research Report 025 |location=Sudbury}}</ref><ref name=":5">{{Cite book |last=Rausand |first=Marvin |title=Risk Assessment: Theory, Methods, and Applications |publisher=[[John Wiley & Sons]] |year=2011 |isbn=978-0-470-63764-7 |location=Hoboken, N.J.}}</ref>

The motivation for placing a monetary value on life is to enable policy and regulatory analysts to allocate the limited supply of [[natural resource|resources]], [[Public capital|infrastructure]], [[Work (human activity)|labor]], and tax revenue. Estimates for the value of a life are used to compare the life-saving and risk-reduction benefits of new policies, regulations, and projects against a variety of other factors,<ref name="Miller" /> often using a [[Cost–benefit analysis|cost-benefit analysis]].<ref name=":4" />

Estimates for the statistical value of life are published and used in practice by various government agencies. In [[Western world|Western countries]] and other [[liberal democracies]], estimates for the value of a statistical life typically range from {{USD|1 million}}–{{USD|10 million}}; for example, the [[United States]] [[FEMA]] estimated the value of a statistical life at {{USD|7.5 million}} in 2020.<ref name="fema_vsl" />

==Treatment in economics and methods of calculation==
There is no standard concept for the value of a specific human life in [[economics]]. However, when looking at risk/reward trade-offs that people make with regard to their health, economists often consider the value of a statistical life (VSL). The VSL is very different from the value of an actual life. It is the value placed on changes in the likelihood of death, not the price someone would pay to avoid certain death. This is best explained by way of an example. From the [[United States Environmental Protection Agency|EPA]]'s website:<blockquote>Suppose each person in a sample of 100,000 people were asked how much he or she would be willing to pay for a reduction in their individual risk of dying by 1 in 100,000, or 0.001%, over the next year. Since this reduction in risk would mean that we would expect one fewer death among the sample of 100,000 people over the next year on average, this is sometimes described as "one statistical life saved.” Now suppose that the average response to this hypothetical question was $100. Then the total dollar amount that the group would be willing to pay to save one statistical life in a year would be $100 per person × 100,000 people, or $10 million. This is what is meant by the "value of a statistical life”.<ref name="EPA" /></blockquote>

This again emphasizes that VSL is more of an estimate of willingness to pay for small reductions in mortality risks rather than how much a human life is worth. Using government spending to see how much is spent to save lives in order to estimate the average individual VSL is a popular method of calculation. The United States government does not have an official value of life threshold, but different values are used in different agencies. It might be that the government values lives quite highly or that calculation standard are not applied uniformly.<ref name="PFPB">{{cite book |last1=Gruber |first1=Jonathan |title=Public Finance and Public Policy |publisher=Worth Publisher |pages=226–233 |edition=5}}</ref> Using the [[United States Environmental Protection Agency|EPA]] as an example, the Agency uses estimates of how much people are willing to pay for small reductions in their risks of dying from adverse health conditions that may be caused by environmental pollution in their [[Cost–benefit analysis|cost-benefit analyses]].<ref name="EPA">{{Cite web|url=https://www.epa.gov/environmental-economics/mortality-risk-valuation| title=Mortality Risk Valuation| publisher=EPA| language=en|access-date=2017-04-25| date=2014-04-21}}</ref>

Economists often estimate the VSL by looking at the risks that people are voluntarily willing to take and how much they must be paid for taking them.<ref>{{cite book|last=Mankiw|first=Gregory|title=Principles of Economics|date=2012|publisher=Cengage Learning |isbn=978-0-538-45305-9}}</ref> This method is known as [[revealed preference]], where the actions of the individual reveal how much they value something. In this context, economists would look at how much individuals are willing to pay for something that reduces their chance of dying. Similarly, compensating differentials, which are the reduced or additional wage payments that are intended to compensate workers for conveniences or downsides of a job, can be used for VSL calculations. For example, a job that is more dangerous for a worker's health might require that the worker be compensated more. The compensating differentials method has several weaknesses. One issue is that the approach assumes that people have information, which is not always available. Another issue is that people may have higher or lower perceptions of risk they are facing that do not equate to actual statistical risk. In general, it is difficult for people to accurately understand and assess risk. It is also hard to control for other aspects of a job or different types of work when using this method.<ref name="PFPB" /> Overall, revealed preference may not represent population preferences as a whole because of the differences between individuals.<ref name="Rohlfs">{{cite journal |last1=Rohlfs |first1=Chris |title=New Estimates of the Value of a Statistical Life Using Air Bag Regulations as a Quasi-experiment |journal=American Economic Journal: Economic Policy |date=2015 |volume=7 |issue=1 |pages=331–59 |doi=10.1257/pol.20110309 |hdl=10419/67207 |url=https://econpapers.repec.org/RePEc:iza:izadps:dp6994 |hdl-access=free }}</ref>

One method that can be used to calculate VSL is summing the total [[present discounted value]] of lifetime earnings. There are a couple of problems using this method. One potential source of variability is that different [[Interest rate#Related terms|discount rates]] can be used in this calculation, resulting in dissimilar VSL estimates. Another potential issue when using wages to value life is that the calculation does not take into account the value of time that is not spent working, such as vacation or leisure.<ref>{{cite journal |last1=Keeler |first1=Emmett |title=The value of remaining lifetime is close to estimated values of life |journal=Journal of Health Economics |date=2001 |volume=20 |issue=1 |pages=141–143|doi=10.1016/S0167-6296(00)00070-9 |pmid=11148869 }}</ref> As a result, VSL estimates may be inaccurate because time spent on leisure could be valued at a higher rate than an individual's wage.<ref name="PFPB" />

Another method used to estimate VSL is [[contingent valuation]]. Contingent valuation asks individuals to value an option either that they have not chosen or are unable to currently choose.<ref name="PFPB" /> Economists might estimate the VSL by simply asking people (e.g. through questionnaires) how much they would be willing to pay for a reduction in the likelihood of dying, perhaps by purchasing safety improvements.<ref>{{cite journal |last1=Murphy |first1=JJ |title=A meta-analysis of hypothetical bias in stated preference valuation |journal=Environmental and Resource Economics |date=2005 |pages=152 |url=https://scholarworks.umass.edu/cgi/viewcontent.cgi?article=1151&context=resec_faculty_pubs}}</ref> These types of studies are referred to as [[Choice modelling#Stated preference|stated preference]] studies. However, contingent valuation has some flaws. The first problem is known as the isolation of issues, where participants may give different values when asked to value something alone versus when they are asked to value multiple things. The order of how these issues are presented to people matters as well.<ref name="PFPB" /> Another potential issue is the “[[embedding effect]]” identified by Diamond and Hausman 1994.<ref>{{cite journal |last1=Diamond |first1=Peter |title=Contingent Valuation: Is Some Number Better than No Number? |journal=  Journal of Economic Perspectives|date=1994 |volume=8 |issue=4 |pages=45–64 |doi=10.1257/jep.8.4.45 |doi-access=free }}</ref> All of these methods might result in a VSL that is overstated or understated.

When calculating value of statistical life, it is important to discount and adjust it for inflation and real income growth over the years. An example of a formula needed to adjust the VSL of a specific year is given by the following:

<math>{VSL}_{T} = {VSL}_{O} * \frac{P_{T}}{P_{O}} * \left( \frac{I_{T}}{I_{O}}\right )^\epsilon</math>

where

VSL<sub>O</sub> = Original Base Year, VSL<sub>T</sub> = Updated Base Year, P<sub>T</sub> = Price Index in Year t, I<sub>T</sub> = Real Incomes in Year t, ε = Income Elasticity of VSL.

==Value of preventing a casualty==
'''{{vanchor|Value of Preventing a Casualty}}''' ('''VPC''') is a more general concept to value of preventing a fatality.<ref>{{cite journal |last1=Linden |first1=Mathias |last2=Kortzfleisch |first2=Harald von |last3=Arndt |first3=Manfred |title=1C23 Railway accident costs: Determining the value of preventing a casualty by analyzing national investigation bodies reports(Safety-Infrastructure) |journal=The Proceedings of International Symposium on Seed-Up and Service Technology for Railway and Maglev Systems |date=2015 |volume=2015 |pages=_1C23–1_–_1C23-8_ |doi=10.1299/jsmestech.2015._1C23-1_ |url=https://www.jstage.jst.go.jp/article/jsmestech/2015/0/2015__1C23-1_/_article/-char/ja/}}</ref> It means the value of preventing a fatality or a serious injury.<ref name=era/> According to [[United Nations Economic and Social Council|Economic and Social Council]]'s provisional agenda for review and analysis of the economic costs of level crossing accidents,<ref>{{cite web |title=ECE/TRANS/WP.1/GE.1/12 |url=https://unece.org/DAM/trans/doc/2015/wp1/ECE-TRANS-WP1-GE1-12e.pdf |access-date=7 April 2024}}</ref> ''"the value of preventing a casualty should be established by either Willingness-To-Pay or Human Capital/Lost Output approaches. It is essential to consider not only fatal injuries, but also serious (or even minor injuries) in this statistical life valuation exercise."''

==Comparisons to other methods==
The value of statistical life (VSL) estimates are often used in the transport sector<ref>{{Cite web |last=Milne |first=Jonathan |date=2006-10-22 |title=The Hidden Price Put on Your Life |url=https://www.thetimes.co.uk/article/the-hidden-price-put-on-your-life-h0dwrls5sjh |url-status=live |archive-url=https://web.archive.org/web/20220820054948/https://www.thetimes.co.uk/article/the-hidden-price-put-on-your-life-h0dwrls5sjh |archive-date=2022-08-20 |access-date=2023-07-17 |website=[[The Times]]}}</ref> and in process safety (where it may be coupled with the [[ALARP]] concept).<ref name=":5" /> In [[health economics]] and in the pharmaceutical sector, however, the value of a [[quality-adjusted life-year]] (QALY) is used more often than the VSL. Both of these measures are used in cost-benefit analyses as a method of assigning a monetary value of bettering or worsening one's life conditions. While QALY measures the quality of life ranging from 0–1, VSL monetizes the values using willingness-to-pay.<ref>{{cite journal |last1=Viscussi |first1=W. Kip |title=The Value of Life |journal=Harvard John M. Olin Discussion Paper Series |date=2005 |issue=517 |url=http://www.law.harvard.edu/programs/olin_center/papers/pdf/Viscusi_517.pdf}}</ref>

Researchers have first attempted to monetize QALY in the 1970s, with countless studies being done to standardize values between and within countries. However, as with the QALY, VSL estimates have also had a history of vastly differing ranges of estimates within countries, notwithstanding a standardization among countries. One of the biggest movements to do so was the EuroVaQ project which used a sample of 40,000 individuals to develop the WTP of several European countries.<ref>{{cite web |title=European Value of a Quality Adjusted Life Year |url=https://research.ncl.ac.uk/eurovaq/ |publisher=Newcastle University}}</ref>

==Policy applications==
Value of life estimates are frequently used to estimate the benefits added due to a new policy or act passed by the government. One example is the 6-year retroactive study on the benefits and costs of the 1970 Clean Air Act{{clarify|Add wikilink|date=February 2021}} in the period from 1970 to 1990. This study was commissioned by the U.S. [[Environmental Protection Agency]] (EPA), [[Office of Air and Radiation]] and [[Office of Policy, Planning and Evaluation]], but was carried out by an independent board of public health experts, economists, and scientists headed by Dr. [[Richard Schmalensee]] of [[MIT]].<ref>{{cite journal |last1=U.S. Environmental Protection Agency |title=The Benefits and Costs of the Clean Air Act, 1970 to 1990- Retrospective Study |journal=Environmental Economics Research Inventory |date=October 1997 |page=I-3 |url=https://www.epa.gov/clean-air-act-overview/benefits-and-costs-clean-air-act-1970-1990-retrospective-study}}</ref>

On conducting the benefit-cost analysis, the team measured each dollar value of an environmental benefit by estimating a how many dollars a person is willing to pay in order to decrease or eliminate a current threat to their health, otherwise known as their "[[willingness-to-pay]]" (WTP). The WTP of the U.S. population was estimated and summed for separate categories including mortality, chronic bronchitis, hypertension, IQ changes, and strokes. Thus, the individual WTPs were added to get the value of a statistical life (VSL) for each category considered in the valuation of the act's benefits.<ref>{{cite journal |last1=U.S. Environmental Protection Agency |title=The Benefits and Costs of the Clean Air Act, 1970 to 1990- Retrospective Study |journal=Environmental Economics Research Inventory |date=October 1997 |page=44 |url=https://www.epa.gov/clean-air-act-overview/benefits-and-costs-clean-air-act-1970-1990-retrospective-study}}</ref> Each valuation in figure 1 was the product of several studies which compiled both solicited WTP information from individuals and WTP estimates from risk compensation demanded in the current labor market and was averaged to find a singular VSL. Such data from the labor market was taken from the [[Census of Fatal Occupational Injuries]] collected by the [[Bureau of Labor Statistics]].<ref>{{cite web |title=Census of Fatal Occupational Injuries (CFOI)- Current and Revised Data |url=https://www.bls.gov/iif/oshcfoi1.htm |website=Bureau of Labor Statistics |publisher=United States Department of Labor}}</ref>

For example, the valuation estimates used for mortality were divided by the typical life expectancy of each survey sample in order to get a dollar estimate per life-year lost or saved which was discounted with a 5 percent discount rate.<ref>{{cite book |last1=Viscusi |first1=W. Kip |title=Fatal Tradeoffs |date=1995 |publisher=Oxford University Press |location=New York |isbn=978-0195102932 |url-access=registration |url=https://archive.org/details/fataltradeoffspu0000visc }}</ref>

Using these estimates, the paper concluded that the benefits, ranging from $5.6 to $49.4 trillion in 1990 dollars, of implementing the Clean Air Act from 1970 to 1990 outweighed the economic costs of $523 billion in 1990 dollars.<ref>{{cite journal |last1=U.S. Environmental Protection Agency |title=The Benefits and Costs of the Clean Air Act, 1970 to 1990- Retrospective Study |journal=Environmental Economics Research Inventory |date=October 1997 |page=8 |url=https://www.epa.gov/clean-air-act-overview/benefits-and-costs-clean-air-act-1970-1990-retrospective-study}}</ref>

==Estimates of the value of life==
{{missing information|section|value in year 2000 US dollar equivalents (currently we have a mix of different nations’ dollars from different times, which isn’t easy to compare); some way to compare per-year/QALY value with whole-life value|date=October 2021}}
Equivalent parameters are used in many countries, with significant variation in the value assigned.<ref name="Miller">{{cite journal |last=Miller |first=Ted R. |date=2000 |title=Variations between Countries in Values of Statistical Life |url= |journal=[[Journal of Transport Economics and Policy]] |volume=34 |pages=169–188 |issn=0022-5258 |access-date= }}</ref>

[[File:International VSL with data values.png|thumb|International VSL with data values{{disputed inline|reason=dialysis study is NOT VSL value; at minimum it should be multiplied by life expectancy because people live for more than one year. Also, not the same dollar.|date=October 2021}}]]

===European Union===

{| class="wikitable sortable"
|+ [[European Union Agency for Railways|ERA]] fall back [[Value of Preventing a Casualty|VPC]] in 2016 in €<ref name=era>{{cite web |title=IMPLEMENTATION GUIDANCE FOR CSIs ANNEX I OF DIRECTIVE (EU) 2016/798 |url=https://www.era.europa.eu/system/files/2022-11/Implementation%20guidance%20for%20CSIs.pdf |access-date=7 April 2024 |date=2016}}</ref>  
|-
! Country !! Fatality !! Serious Injury !! Slight injury
|-
| Austria || 3,601,014 || 569,387 || 43,974
|-
| Belgium || 3,582,968 || 550,056 || 42,488
|-
| Bulgaria || 1,728,479 || 242,133 || 18,703
|-
| Croatia || 2,541,972 || 355,636 || 27,459
|-
| Czech Republic || 3,028,481 || 428,346 || 33,055
|-
| Denmark || 3,988,844 || 622,286 || 48,084
|-
| Estonia || 2,921,585 || 416,085 || 32,124
|-
| Finland || 3,248,716 || 517,252 || 39,987
|-
| France || 3,122,352 || 486,856 || 37,628
|-
| Germany || 3,455,179 || 539,346 || 41,660
|-
| Greece || 2,326,951 || 356,127 || 27,527
|-
| Hungary || 2,761,351 || 383,034 || 29,559
|-
| Ireland || 5,085,099 || 747,910 || 57,709
|-
| Italy || 3,248,106 || 501,498 || 38,735
|-
| Latvia || 2,338,370 || 337,234 || 26,049
|-
| Lithuania || 2,697,114 || 389,643 || 30,071
|-
| Luxembourg || 6,491,289 || 996,412 || 76,843
|-
| Netherlands || 3,550,348 || 543,938 || 42,020
|-
| Norway || 3,402,766 || 573,324 || 44,341
|-
| Poland || 2,412,823 || 341,458 || 26,356
|-
| Portugal || 2,541,032 || 385,934 || 29,815
|-
| Romania || 2,443,038 || 339,588 || 26,203
|-
| Slovakia || 2,846,309 || 404,481 || 31,222
|-
| Slovenia || 2,425,302 || 364,655 || 28,182
|-
| Spain || 3,019,875 || 458,207 || 35,392
|-
| Sweden || 3,296,192 || 520,782 || 40,270
|-
| Switzerland || 4,422,265 || 759,440 || 58,666
|-
| United Kingdom || 2,873,899 || 481,459 || 37,222
|-
| '''EU average''' || 3,273,910 || 498,591 || 38,514
|}

====Sweden====
In Sweden, the value of a statistical life has been estimated from 9 to 98 million SEK (€0.9 - 10.6 million).<ref>{{cite journal |last1=Hultkrantz |first1=Lars |title=The value of a statistical life in Sweden: A review of the empirical literature |journal=Health Policy |date=20 September 2012 |volume=108 |issue=2–3 |pages=302–310 |doi=10.1016/j.healthpol.2012.09.007 |pmid=23084655 }}</ref>
* 34.6 million SEK (€3.7 million) mean of studies in Sweden from 1995 and on
* 23 million SEK (€2.5 million) median of studies in Sweden from 1995 and on
* 22 million SEK (€2.4 million) recommended by official authorities

===Australia===
In Australia, the value of a statistical life has been set at:
* AU$5.4 million (2023)<ref name="DPMC">{{cite web| url=https://oia.pmc.gov.au/sites/default/files/2023-10/value-of-statistical-life.pdf| title=Best Practice Regulation Guidance Note: Value of statistical life| date=October 2023| publisher=Department of the Prime Minister and Cabinet, Australian Government}}</ref>
* AU$235,000 per year (2023)

===India===
Using a hedonic wage approach, the VSL in India among blue-collar male workers in manufacturing industries of Ahmedabad, Gujarat has been estimated to be 44.69 million INR ($0.64 million) in 2018.<ref>{{cite book |url=http://www.isec.ac.in/WP%20407%20-%20Agamoni%20Majumder%20and%20Madheswaran%20-%20Final.pdf |isbn=978-81-7791-263-0|title=Value of Statistical Life in India: A Hedonic Wage Approach|last1=Majumder|first1=Agamoni|last2=Madheswaran|first2=S.|year=2018|publisher=Institute for Social and Economic Change }}</ref>

===New Zealand===
In New Zealand, the value of a statistical life has been set at:
* NZ$2 million (1991) by NZTA<ref name="NZTA">{{cite web| url=http://www.transport.govt.nz/assets/Uploads/Research/Documents/Social-cost-of-road-crashes-and-injuries-2016-update-final.pdf| title=Social cost of road crashes and injuries 2016 update| date=March 2017| publisher=NZTA}}</ref>
* NZ$3.85 million (2013) by The Treasury<ref>{{cite web| url=https://treasury.govt.nz/publications/guide/guide-social-cost-benefit-analysis| title=Guide to Social Cost Benefit Analysis| publisher=The Treasury| date=27 July 2015}}</ref>
* NZ$4.14 million (2016) by NZTA<ref name="NZTA" />
* NZ$4.53 million (June 2019) by Ministry of Transport <ref>{{cite web |url=https://www.transport.govt.nz/about-us/news/social-cost-of-road-crashes-and-injuries-2019-update/#:~:text=The%20updated%20value%20of%20statistical,per%20fatality%20of%20%244.56%20million.| title=Social cost of road crashes and injuries 2019 update }}</ref>
* NZ$150,000 per year (2022) by Ministry of Health <ref>{{cite web |url=https://www.health.govt.nz/system/files/documents/publications/cost_of_illness_ltcs_2_jun_-_jr.pdf#page=55| title=Cost of long-term conditions in New Zealand }}</ref>
* NZ$12.5 million (April 2023) by NZTA <ref>{{cite web |url=https://www.nzta.govt.nz/resources/monetised-benefits-and-costs-manual/.| title=Monetised benefits and costs manual}}</ref>

===Singapore===

The value of statistical life (VSL) in Singapore was estimated in 2007 via a contingent valuation survey that elicits willingness-to-pay (WTP) for mortality risk reductions, which interviewed 801 Singaporeans and Singapore Permanent Residents aged 40 and above, entailing a value of statistical life of approximately S$850,000 to S$2.05 million (in 2007 S$, which is approximately 1.36 S$ in 2022). Mean WTP was also shown to have an inverse relationship with age, and is about 20% lower for persons aged 70 and older. Consistent with existing literature, the study also finds that mean WTP is not affected by physical health; but is affected by mental health. In addition, mean WTP is not affected by covariates such as gender, race, and personal income, but is affected by covariates such as household income, age, occupation and level of education.<ref>{{cite web | url=https://dr.ntu.edu.sg/handle/10356/13378 | title=The value of statistical life in Singapore | year=2008 | last1=Hoon | first1=Shi | last2=Lim | first2=Khee Meng }}</ref>

For traffic accidents, the WTP-based VSL was estimated in 2008 at S$1.87 million (in 2008 S$, which is approximately 1.27 S$ in 2022). This was also compared against WTP-based VSL estimates in other countries, including 4.63 million for the US, 3.11 million for Sweden, 2.41 million for the UK, 2.38 million for New Zealand and 1.76 million for the EU (in 2008 S$).<ref>{{cite web| url=https://citeseerx.ist.psu.edu/document?repid=rep1&type=pdf&doi=d7f4873a2591704af85b558b8fd4eb1d1b12bd83 | access-date=2024-01-15 | title=Deriving Accident Costs using Willingness-to-Pay {{!}} Approaches - A Case Study for Singapore}}</ref>

The VSL obtained by other methods may differ significantly. For instance, if the VSL is estimated from the World Bank VSL adjusted to country-specific gross domestic product, which reflects a [[human capital]] approach, then the VSL in Singapore would be calculated to be US$8.96 million in 2014 (S$11.3 million in 2014, in 2014 S$, which is approximately 1.09 S$ in 2022).<ref>{{cite journal | pmc=9874370 | year=2022 | last1=Egerstrom | first1=N. | last2=Rojas-Rueda | first2=D. | last3=Martuzzi | first3=M. | last4=Jalaludin | first4=B. | last5=Nieuwenhuijsen | first5=M. | last6=So | first6=R. | last7=Lim | first7=Y. H. | last8=Loft | first8=S. | last9=Andersen | first9=Z. J. | last10=Cole-Hunter | first10=T. | title=Health and economic benefits of meeting WHO air quality guidelines, Western Pacific Region | journal=Bulletin of the World Health Organization | volume=101 | issue=2 | pages=130–139 | doi=10.2471/BLT.22.288938 | pmid=36733628 }}</ref>

===Turkey===
Studies by [[Hacettepe University]] estimated the VSL at about half a million [[purchasing power parity]] adjusted 2012 US dollars,<ref>{{Cite journal|last1=Ara|first1=Shihomi|last2=Tekeşin|first2=Cem|date=4 July 2014|title=Measuring the Value of Mortality Risk Reductions in Turkey|journal=International Journal of Environmental Research and Public Health|language=en|volume=11|issue=7|pages=6890–6922|doi=10.3390/ijerph110706890|pmid=25000150|pmc=4113852|doi-access=free}}</ref> the value of a healthier and longer life (VHLL) for Turkey at about 42,000 [[Turkish lira|lira]] (about $27,600 in PPP-adjusted 2012 USD), and the value of a life year (VOLY) as about 10,300 TL (about $6,800 in PPP-adjusted 2012 USD), all {{as of|2012|lc=y}}.<ref>{{Cite journal|last1=Tekeşin|first1=Cem|last2=Ara|first2=Shihomi|date=29 September 2017|title=The Monetary Valuation of Lifetime Health Improvement and Life Expectancy Gains in Turkey|journal=International Journal of Environmental Research and Public Health|language=en|volume=14|issue=10|pages=1151|doi=10.3390/ijerph14101151|pmid=28961227|pmc=5664652|doi-access=free}}</ref>

{{As of|2016}} the estimated produced economic value for a life time for Turkey was US$59,000 which was 5.4 times GDP per capita.<ref>{{Cite journal|last1=Tuna|first1=E.|last2=Yenilmez|first2=F. B.|last3=Kockaya|first3=G.|date=2016-11-01|title=Estimation Of Value Of Life With A Model Approach Depending On Net Present Value For Turkey|url=https://www.valueinhealthjournal.com/article/S1098-3015(16)32122-2/abstract|journal=Value in Health|language=en|volume=19|issue=7|pages=A477|doi=10.1016/j.jval.2016.09.756|issn=1098-3015|doi-access=free}}</ref>

===Russia===
According to different estimates life value in Russia varies from $40,000 up to $2 million. On the results of opinion poll life value (as the cost of financial compensation for the death) in the beginning of 2015 was about $71,500.<ref>{{Cite web|url = http://www.rgs.ru/media/CSR/on_startup/Life_value_2015.pdf|title = Стоимость человеческой жизни в России в 2015 году составила 4,5 млн. рублей|publisher = Center for Strategic Researches RGS}}</ref>

===United Kingdom===
As of 2013, the value of preventing a fatal casualty was £1.7m (2013 prices) in UK.<ref>{{cite web |title=UK Transport Safety: Who is responsible? |url=https://www.pacts.org.uk/wp-content/uploads/TSCResponsibility_LowRes-COMPLETE-FINAL.pdf |access-date=7 April 2024 |date=March 2015}}</ref>

===United States===
The following estimates have been applied to the value of life. The estimates are either for ''one year'' of additional life or for the statistical value of a ''single'' life.
* $50,000 per year of quality life (the "dialysis standard",<ref>{{Cite journal|last=Hirth|first=Richard A.|date=2000|title=Willingness to pay for a quality-adjusted life year: in search of a standard|journal=Medical Decision Making|volume=20|issue=3|pages=332–342|doi=10.1177/0272989X0002000310|pmid=10929856|s2cid=25646395}}</ref> which had been a de facto international standard most private and government-run health insurance plans worldwide use to determine whether to cover a new medical procedure)<ref name=time>{{cite news|last=Kingsbury|first=Kathleen|title=The Value of a Human Life: $129,000|publisher=[[Time (magazine)|Time]]|url=http://www.time.com/time/health/article/0,8599,1808049,00.html|archive-url=https://web.archive.org/web/20080527005749/http://www.time.com/time/health/article/0,8599,1808049,00.html|url-status=dead|archive-date=May 27, 2008|date=20 May 2008}}</ref>
* $129,000 per year of quality life (an update to the "dialysis standard")<ref>{{Cite journal|last=Lee|first=Chris P.|date=2009|title=An Empiric Estimate of the Value of Life: Updating the Renal Dialysis Cost-Effectiveness Standard|journal=Value in Health|volume=12 |issue=1|pages=80–87|doi=10.1111/j.1524-4733.2008.00401.x |pmid=19911442|doi-access=free}}</ref><ref name=time />
* $7.5 million (Federal Emergency Management Agency, Jul. 2020)<ref name="fema_vsl">{{Cite web|url=https://www.fema.gov/sites/default/files/2020-08/fema_bca_toolkit_release-notes-july-2020.pdf|title=FEMA Benefit-Cost Analysis (BCA) Toolkit 6.0 Release Notes|date=2020-07-31|access-date=2021-10-29}}</ref>
* $9.1 million (Environmental Protection Agency, 2010)<ref name="nytimes">{{cite news|last=Appelbaum|first=Binyamin|date=Feb 16, 2011|title=As U.S. Agencies Put More Value on a Life, Businesses Fret|work=The New York Times|url=https://www.nytimes.com/2011/02/17/business/economy/17regulation.html?_r=0&pagewanted=all}}</ref>
* $9.2 million (Department of Transportation, 2014)<ref>{{cite web| title=Guidance on Treatment of the Economic Value of a Statistical Life| url=http://www.dot.gov/sites/dot.gov/files/docs/VSL_Guidance_2014.pdf| date=13 June 2014| publisher=US Department of Transportation}}</ref>
* $9.6 million (Department of Transportation, Aug. 2016)<ref>{{Cite web|url=https://www.transportation.gov/sites/dot.gov/files/docs/2016%20Revised%20Value%20of%20a%20Statistical%20Life%20Guidance.pdf|title=DoT 2016|date=2016-08-08|access-date=2017-04-23}}</ref>
* $12.5 million (Department of Transportation, 2022)<ref name=":6">{{Cite web |date=23 March 2021 |title=Departmental Guidance on Valuation of a Statistical Life in Economic Analysis |url=https://www.transportation.gov/office-policy/transportation-policy/revised-departmental-guidance-on-valuation-of-a-statistical-life-in-economic-analysis |access-date=24 October 2023 |website=U.S. Department of Transportation}}</ref>
* $13.2 million (Department of Transportation, 2023)<ref name=":6" />

The [[income elasticity]] of the value of statistical life has been estimated at 0.5 to 0.6.<ref name=ViscusiAldy>{{cite journal| last1=Viscusi|first1=W. Kip| first2=Joseph E.| last2=Aldy| title=The Value of a Statistical Life: A Critical Review of Market Estimates Throughout the World | journal= Journal of Risk and Uncertainty |date=2003 |volume=27 |issue=1 |pages=5–76 |doi=10.1023/A:1025598106257 |s2cid=189928888}}</ref> Developing markets have smaller statistical value of life.<ref name=ViscusiAldy /> The statistical value of life also decreases with age.<ref name=ViscusiAldy />

Historically, children were valued little monetarily, but changes in cultural norms have resulted in a substantial increase as evinced by trends in damage compensation from wrongful death lawsuits.<ref>{{cite web|last1=Mayyasi|first1=Alex|title=How Children Went from Worthless to Priceless|url=http://priceonomics.com/the-price-of-a-child/|website=Priceonomics|date=30 June 2016 |access-date=8 July 2016}}</ref>

==Uses==
Knowing the value of life is helpful when performing a cost-benefit analysis, especially in regard to public policy. In order to decide whether or not a policy is worth undertaking, it is important to accurately measure costs and benefits. Public programs that deal with things like safety (i.e. highways, disease control, housing) require accurate valuations in order to budget spending.<ref name="Citation dorothy rice">{{cite journal |last1=Rice |first1=Dorothy |title=The Economic Value of Human Life |journal=American Journal of Public Health |date=1967 |volume=57 |issue=11 |pages=1954–1966 |doi=10.2105/AJPH.57.11.1954 |pmid=6069745 |pmc=1227852 }}</ref>

Since resources are finite, [[trade-off]]s are inevitable, even regarding potential life-or-death decisions. The assignment of a value to individual life is one possible approach to attempting to make [[rational decision]]s about these trade-offs.

When deciding on the appropriate level of health care spending, a typical method is to equate the marginal cost of the health care to the marginal benefits received.<ref name="Robert Hall Charles Jones">{{cite journal |last1=Hall |first1=Robert |title=The Value of Life and the Rise of Health Spending |journal=Quarterly Journal of Economics |date=2007 |volume=122 |pages=39–72 |doi=10.1162/qjec.122.1.39 |s2cid=1542501 |url=https://web.stanford.edu/~rehall/HallJones2007.pdf}}</ref> In order to obtain a marginal benefit amount, some estimation of the dollar value of life is required. One notable example was found by Stanford professor Stefanos Zenios, whose team calculated the [[cost-effectiveness]] of [[kidney dialysis]]. His team found that the VSL implied by then current dialysis practice averages about US$129,000 per quality-adjusted life year ([[QALY]]).<ref name="Zenios Stanford">{{cite journal |last1=Zenios |first1=Stefanos |title=An Empiric Estimate of the Value of Life: Updating the Renal Dialysis Cost-Effectiveness Standard |journal= Value in Health|date=2009 |volume=12 |issue=1 |pages=80–87 |doi=10.1111/j.1524-4733.2008.00401.x |pmid=19911442 |doi-access=free }}</ref> This calculation has important implications for health care as Zenios explained: <blockquote> "That means that if Medicare paid an additional $129,000 to treat a group of patients, on average, group members would get one more quality-adjusted life year."<ref name="Time Magazine Dialysis">{{cite magazine |last1=Kingsbury |first1=Kathleen |title=The Value of a Human Life: $129,000 |url=http://content.time.com/time/health/article/0,8599,1808049,00.html |magazine=TIME |access-date=10 March 2019|date=2008-05-20 }}</ref></blockquote>

In [[risk management]] activities such as in the areas of [[occupational safety and health|workplace safety]], and insurance, it is often useful to put a precise economic value on a given life. The [[Occupational Safety and Health Administration]] under the [[Department of Labor]] sets penalties and regulations for companies to comply with safety standards to prevent workplace injuries and deaths.<ref name="OSHA">{{cite web |title=OSHA |url=https://www.osha.gov/ |website=OSHA |publisher=Department of Labor |access-date=10 March 2019}}</ref> It can be argued that these high penalties are intended to act as a deterrent so that companies have an incentive to avoid them. As such, the price of the fines would have to be roughly equivalent to the value of a human life. Although some studies of the effectiveness of fines as a deterrent have found mixed results.<ref name="CA law review">{{cite journal |last1=Kennedy |first1=Christopher |title=Criminal Sentences for Corporations: Alternative Fining Mechanisms |journal=California Law Review |date=1985 |volume=73 |issue=2 |doi=10.15779/Z385X6G }}</ref>

In transportation modes it is very important to consider the [[external cost]] that is paid by the society but is not calculated, for making it more [[sustainable]]. The external cost, although consisting of impacts on [[climate]], [[crops]] and [[public health]] among others, is largely determined by impacts on [[mortality rate]].

== Criticisms ==
The value of a statistical life has come under criticism from a range of sources both in economics and [[philosophy]].<ref name=":0">{{Cite journal |last=Sunstein |first=Cass |date=2004-11-01 |title=Valuing Life: A Plea for Disaggregation |url=https://scholarship.law.duke.edu/dlj/vol54/iss2/2 |journal=Duke Law Journal |volume=54 |issue=2 |pages=385–445 |pmid=15940845 |issn=0012-7086}}</ref><ref name=":1">{{Cite journal |last=Cameron |first=Trudy Ann |date=2010-07-01 |title=Euthanizing the Value of a Statistical Life |url=https://www.journals.uchicago.edu/doi/abs/10.1093/reep/req010 |journal=Review of Environmental Economics and Policy |volume=4 |issue=2 |pages=161–178 |doi=10.1093/reep/req010 |issn=1750-6816|citeseerx=10.1.1.722.7945 }}</ref><ref name=":2">{{Cite book |last=Carneades |url=https://www.researchgate.net/publication/361535357 |title=Are All Lives Equal? Why Cost Benefit Analysis Values Rich Lives More and How Philosophy Can Fix it |publisher=[[Carneades.org]] |year=2022 |isbn=979-8986128610}}</ref><ref name=":3"/><ref>{{Cite journal |last1=John |first1=Stephen David |last2=Curran |first2=Emma J. |date=2021-03-19 |title=Costa, cancer and coronavirus: contractualism as a guide to the ethics of lockdown |url=https://jme.bmj.com/content/early/2021/03/19/medethics-2020-107103 |journal=Journal of Medical Ethics |volume=48 |issue=9 |pages=643–650 |language=en |doi=10.1136/medethics-2020-107103 |issn=0306-6800 |pmid=33741680|pmc=7985975 }}</ref>  These criticisms range from concerns with the specific methodology used, to value a statistical life to the very prospect of valuing life and using it in cost benefit analyses.

=== Concerns with aggregation ===
Some economists have argued that the value of a statistical life should be "disaggregated" to better capture the differences in mortality risk reduction preferences.<ref name=":1" /><ref name=":0" /> [[Cass Sunstein]] and others have argued that the value of a statistical life should vary by type of risks, as people are more concerned about some risks than others, and by individuals, as some people are more risk seeking than others.<ref>{{Cite journal |last=Sunstein |first=Cass |date=2004-11-01 |title=Valuing Life: A Plea for Disaggregation |url=https://scholarship.law.duke.edu/dlj/vol54/iss2/2 |journal=Duke Law Journal |volume=54 |issue=2 |pages=385–445 |pmid=15940845 |issn=0012-7086 |quote=First, VSL should vary across risks. For example, people are willing to pay high amounts to avoid cancer risks, and hence there is reason to think that people's VSL is higher for cancer deaths than for sudden, unanticipated deaths. Cancer risks are involved in the work of many regulatory agencies, and people seem to be particularly concerned about such risks, in a way that should produce a high VSL- almost unquestionably higher than the values that agencies now use. More generally, deaths that produce unusual fear, or that are accompanied by high levels of pain and suffering, should be expected to produce a higher VSL. Human beings face countless mortality risks, and it would be truly bizarre to maintain that people value avoiding each of those risks identically.  Second, VSL should vary across individuals, simply because different people are willing to pay different amounts to avoid risks. People who are risk averse will be willing to pay more, and will therefore show a higher VSL, than people who are risk-seeking. Those who are rich will show a higher VSL than those who are poor. People who are thirty might well show a higher VSL than people who are sixty.  It follows that different demographic groups will show diversity in their VSLs as well.}}</ref><ref name=":1" />  This is proposed to ensure the accuracy of the measurement, as using an average may force some people to pay more than they are willing to for risk reduction, and prevent policies from being enacted for people who are willing to pay more than average for mortality risk reduction.<ref>{{Cite book |last=Carneades |url=https://www.researchgate.net/publication/361535357 |title=Are All Lives Equal? Why Cost Benefit Analysis Values Rich Lives More and How Philosophy Can Fix it |publisher=Carneades.org |year=2022 |isbn=979-8986128610 |quote=we should value risks by demographic groups so that if a particular group is more impacted by a risk than another, we can use a more accurate value of a statistical life for that group. This will assure that the government neither imposes undue costs or fails to eliminate risks that individuals would be willing to pay to eliminate.}}</ref>

=== Concerns with valuing life ===
Some philosophers and policymakers have concerns about the underlying idea of valuing a statistical life at all.  While some of these concerns represent a misunderstanding of what is meant by the value of a statistical life, many express concerns with the project of valuing lives.<ref name=":1" /><ref name=":2" />  [[Elizabeth S. Anderson|Elizabeth Anderson]] and other philosophers have argued that the methods for measuring the value of a statistical life are insufficiently accurate as they rely on wage studies that are conducted in non-competitive labor markets where workers have insufficient information about their working conditions to accurately determine the risk of death from taking a particular job.<ref>{{Cite book |last=Ackerman |first=Frank |url=https://www.worldcat.org/oclc/52819812 |title=Priceless: on knowing the price of everything and the value of nothing |date=2004 |others=Lisa Heinzerling |publisher=New Press |isbn=1-56584-850-0 |oclc=52819812}}</ref><ref name=":3">{{Cite book |last=Anderson |first=Elizabeth |url=https://www.worldcat.org/oclc/27430064 |title=Value in ethics and economics |date=1993 |publisher=Harvard University Press |isbn=0-674-93189-0 |location=Cambridge, Mass. |oclc=27430064}}</ref>  Further these philosophers contend that some goods (including mortality risk, as well as environmental goods) are simply incommensurate, it is impossible to compare them, and therefore impossible to monetize them and put them on a single scale, making the very practice of valuing a statistical life problematic.<ref>{{Cite book |last=Sagoff |first=Mark |url=https://www.worldcat.org/oclc/76951369 |title=Price, principle, and the environment |date=2004 |publisher=Cambridge University Press |isbn=0-511-23172-5 |location=Cambridge, UK |oclc=76951369}}</ref><ref name=":3" /><ref>{{Cite book |last=Carneades |url=https://www.researchgate.net/publication/361535357 |title=Are All Lives Equal? Why Cost Benefit Analysis Values Rich Lives More and How Philosophy Can Fix it |date=25 June 2022 |publisher=Carneades.org |isbn=979-8986128610 |quote=If there are some goods that cannot be compared, then the project of attempting to monetize all of the benefits and costs for comparison is flawed from the start. If you accept this position, you may have a way out of the original problematic conclusion. If we cannot compare the value of a life and other benefits, then the problem of disparately valued lives comes from trying to convert a life into something with which it cannot be compared: money.}}</ref>

Economists have responded to the more superficial concerns by advocating renaming or rebranding the value of a statistical life as a "micromort" or the amount someone would be willing to pay to reduce a one in one million risk of death, though philosophers contend that this does not resolve the underlying issues.<ref name=":2" /><ref name=":1" />

==See also==
* [[ALARP]]
* [[Disability-adjusted life year]]
* [[Hedonic damages]]
* [[Intrinsic value (ethics)]]
* [[Meaning of life#Psychological significance and value in life|Psychological significance and value in life]]
* [[Rational choice theory]]
* [[Utilitarianism]]
* [[Value (personal and cultural)]]

==References==
{{Reflist|30em}}

==Further reading==
* {{cite journal |last1=Murphy |first1=Kevin M. |author-link=Kevin M. Murphy |last2=Topel |first2=Robert H. |year=2006 |title=The Value of Health and Longevity |journal=[[Journal of Political Economy]] |volume=114 |issue=5 |pages=871–904 |doi=10.1086/508033 |s2cid=19755649|url=http://papers.nber.org/papers/w11405.pdf }}
* {{Cite book |last=Schelling |first=Thomas C. |title=[[The New Palgrave: A Dictionary of Economics]] |year=1987 |volume=4 |pages=793–96 |chapter=Value of Life |author-link=Thomas Schelling}}
* Viscusi, W. Kip (2003). [http://www.law.harvard.edu/programs/olin_center/papers/pdf/422.pdf ''The Value of Life: Estimates with Risks by Occupation and Industry''] (PDF). Discussion Paper No. 422. Cambridge, Mass.: [[Harvard Law School]]. {{ISSN|1045-6333}}.  Retrieved 17 July 2023.

==External links==
* {{cite web| url=http://safety.fhwa.dot.gov/facts_stats/t75702.cfm  | title=Motor Vehicle Accident Costs| publisher=US Department of Transportation| date=31 October 1994}}

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{{DEFAULTSORT:Value Of Life}}
[[Category:Demographic economics]]
[[Category:Philosophy of life]]
[[Category:Valuation (finance)]]
[[Category:Business ethics]]
[[Category:Welfare economics]]
[[Category:Utilitarianism]]
[[Category:Safety analysis]]
[[Category:Actuarial science]]