Hostname: page-component-586b7cd67f-t7czq Total loading time: 0 Render date: 2024-11-20T07:37:37.332Z Has data issue: false hasContentIssue false
  • English
  • Français

The Value of the Risk to Life in the Context of Crime

Published online by Cambridge University Press:  02 September 2019

Emilio Picasso  and
Mariana Conte Grand
Emilio Picasso*
Affiliation:
Universidad Católica Argentina, Av Moreau de Justo 1600, (1107), Buenos Aires, Argentina, e-mail: [email protected]
Mariana Conte Grand
Affiliation:
Universidad del CEMA, Universidad del CEMA, Av Cordoba 374, (1054), Buenos Aires, Argentina
*
*e-mail: [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

The value of the risk to life is a key element for benefit-cost analysis, enabling more rational public policy decisions in diverse areas as environmental, health, and crime. We value the risk to life in the context of crime using a discrete choice experiment (CE). The method has clear advantages in that it applies to the whole population and does not require vast data from labor markets, for example. Such data are not always available even in developed economies. Combining the stated preference approach with contingent valuation (CV), CE offer advantages yet to be explored in the context of crime. We demonstrate the application in a developing economy, where similar valuations are not available. The best estimate obtained for Argentina is an average of 1.5 million in 2015 US dollars per statistical life with a confidence interval ($1.1–$2.3). This result is consistent with estimates for the developed world, after appropriate transfer. We also analyze demographic factors in the risk to life, finding a positive influence of income, risk aversion, previous victimization experience and family size on the value of a statistical life, as well as a negative impact of individualism.

Keywords

choice experimentcrime valuationdiscrete choice modelrisk to lifevalue of statistical life.J17K14Q51.
Type
Article
Information
Journal of Benefit-Cost Analysis , Volume 10 , Issue 2 , Summer 2019 , pp. 178 - 205
Copyright
© Society for Benefit-Cost Analysis, 2019 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Adamowicz, Wiktor, Louviere, Jordan, and Swait, Joffre. 1998. Introduction to Attribute-Based Stated Choice Methods. Report Submitted to the Resource Valuation Branch, Damage Assessment Center, NOAA (National Oceanic and Atmospheric Administration), US Department of Commerce, January.Google Scholar
Alberini, Anna, and Scasny, Milan. 2013. “Exploring Heterogeneity in the Value of a Statistical Life: Cause of Death v. Risk Perceptions.” Ecological Economics, 94: 143–155.Google Scholar
Aldy, Joseph E., and Viscusi, W. K., 2008. “Adjusting the Value of a Statistical Life for Age and Cohort Effects.” The Review of Economics and Statistics, 90(3): 573–581.Google Scholar
Atkinson, Giles, Healey, Andrew, and Mourato, Susana. 2005. “Valuing the Costs of Violent Crime: A Stated Preference Approach.” Oxford aEconomic Papers, 57: 559–585.Google Scholar
Birchenall, Javier A., and Soares, Rodrigo R.. 2009. “Altruism, Fertility, and the Value of Children: Health Policy Evaluation and Intergenerational Welfare.” Journal of Public Economics. 93(1–2): 280–295.Google Scholar
Blomquist, Glenn C. 2004. “Self-Protection and Averting Behavior, Values of Statistical Lives, and Benefit Cost Analysis of Environmental Policy.” Review of Economics of the Household, 2(1): 89–110.Google Scholar
Box, George E.P., and Cox, David R.. 1964. “An Analysis of Transformations.” Journal Royal Statistical Society B, 26(2): 21–252.Google Scholar
Cameron, Trudy A.. 2010. “Euthanizing the Value of a Statistical Life.” Review of Environmental Economics and Policy, 4(2): 161–178.Google Scholar
Cameron, Trudy A., and De Shazo, J. R., 2013. “Demand for Health Risk Reductions.” Journal of Environmental Economics and Management, 65(1): 87–109.Google Scholar
Carson, Richard T. 1997. “Contingent Valuation Surveys and Tests of Insensitivity to Scope”. In Determining the Value of Non-Marketed Goods, edited by Kopp, Raymond J., Pommerehne, Werner W., and Schwarz, Norbert, 127–163. Netherlands: Springer.Google Scholar
Carson, Richard T. and Louviere, Jordan, 2017. “Estimation of Broad-Scale Tradeoffs in Community Policing Policies.” Journal of Benefit-Cost Analysis, 8(3): 385–398.Google Scholar
Caussade, Sebastián, Ortúzar, Juan de Dios, Rizzi, Luis I., and Hensher, David A.. 2005. “Assessing the Influence of Design Dimensions on Stated Choice Experiment Estimates.” Transportation Research Part B, 39: 621–640.Google Scholar
Cohen, Mark A. 1988. “Pain, Suffering and Jury Awards: A Study of the Cost of Crime to Victims.” Law and Society Review, 22: 537–555.Google Scholar
Cohen, Mark A. 2010. “Valuing Crime Control Benefits using Stated Preference Approaches” In Cost-Benefit Analysis and Crime Control, edited by Roman, John K., Dunworth, John, and Marsh, Kevin, 73–117, Washington, D.C.: Urban Institute Press.Google Scholar
Cohen, Mark A. 2015. “Willingness to Pay to Reduce White-Collar and Corporate Crime.” Journal of Benefit-Cost Analysis, 6(02): 305–324.Google Scholar
Cohen, Mark A., Rust, Ronald T., Steen, Sara, and Tidd, Simon T.. 2004. “Willingness-to-pay for Crime Control Programs.” Criminology, 42(1): 89–110.Google Scholar
Cropper, Maureen L., Hammitt, James K., and Robinson, Lisa K.. 2011. “Valuing Mortality Risk Reductions: Progress and Challenges.” Annual Review of Resource Economics, 3: 313–336.Google Scholar
Desvousgues, William, Mathews, Kristi, and Train, Kenneth. 2012. “Adequate Responsiveness to Scope in Contingent Valuation.” Ecological Economics, 84: 121–128.Google Scholar
Di Tella, Rafael, Galiani, Sebastián and Schargrodsky, Ernesto. 2006. Crime Distribution and Victim Behavior During a Crime Wave. William Davidson Institute Working Papers Series No. wp849.Google Scholar
Di Tella, Rafael and MacCulloch, Robert. 2006. “Some uses of Happiness Data in Economics.” Journal of Economic Perspectives, 20: 25–46.Google Scholar
Federov, Valeriǐ Vadimovich. 1972. Theory of Experiments, translated and edited by Studden, William J. and Eugene, Klimko M.. New York, NY: Academic Press.Google Scholar
Fein, Rashi. 1958. Economics of Mental Illness. New York, NY: Basic Books.Google Scholar
Freeman, A. Myrick. 2003. The Measurement of Environmental and Resource Values. 2nd ed. Washington, D.C.: Resources for the Future.Google Scholar
Haab, Timothy, and McConnell, Kenneth. 2002. Valuing Environmental and Natural Resources: The Econometrics of Non-Market Valuation. United Kingdom: Edward Elgar Publishing.Google Scholar
Hammitt, James K. 2017. “Extrapolating the Value per Statistical Life Between Populations: Theoretical Implications.” Journal of Benefit-Cost Analysis, 8(2): 215–225.Google Scholar
Hanley, Nick, Wright, Robert E., and Adamowicz, Wiktor. 1998. “Using Choice Experiments to Value the Environment.” Environmental and Resource Economics 11(3–4): 413–428.Google Scholar
Hensher, David A. 2004. “Identifying the Influence of Stated Choice Design Dimensionality on Willingness to Pay for Travel Time Savings.” Journal of Transport Economics and Policy, 38(3): 425–46.Google Scholar
Hensher, David A.. 2006. “Revealing Differences in Willingness to Pay Due to the Dimensionality of Stated Choice Designs: An Initial Assessment.” Environmental and Resource Economics, 34(1): 7–44.Google Scholar
Hensher, David A., Rose, John M., Ortuzar, Juan de Dios, and Rizzi, Luis I.. 2009. “Estimating the Willingness to Pay and Value of Risk Reduction for Car Occupants in the Road Environment.” Transportation Research Part A, 43: 692–707.Google Scholar
Hoffmann, Sandra, Krupnick, Alan, and Qin, Ping. 2017. “Building a Set of Internationally Comparable VSL Studies: Estimates of Chinese Willingness to Pay to Reduce Mortality Risk.” Journal of Benefit-Cost Analysis, 8(2): 251–289.Google Scholar
Hojman, Pablo, Ortúzar, Juan de Dios, and Rizzi, Luis I.. 2005. “On the Joint Valuation of Averting Fatal and Severe Injuries in Highway Accidents.” Journal of Safety Research, 36: 377–386.Google Scholar
Kahneman, Daniel, and Tversky, Amos. 1979. “Prospect Theory: An Analysis of Decision under Risk.” Econometrica, 47(2): 263–291.Google Scholar
Kniesner, Thomas J., Viscusi, Kip W., and Ziliak, James P.. 2010. “Policy Relevant Heterogeneity in the Value of Statistical Life: New Evidence from Panel Data Quantile Regressions.” Journal of Risk and Uncertainty, 40: 15–31.Google Scholar
Linden, Leigh, and Rockoff, Jonah E.. 2008. “Estimates of the Impact of Crime Risk on Property Values from Megan’s Laws.” American Economic Review, 98(3): 1103–1127.Google Scholar
Louviere, Jordan, Hensher, David A., and Swait, Joffre. 2000. Stated Choice Methods: Analysis and Applications. New York, NY: Cambridge Univiversity Press.Google Scholar
Ludwig, Jens, and Cook, Philip J.. 2001. “The Benefits of Reducing Gun Violence: Evidence from Contingent Valuation Survey Data.” Journal of Risk and Uncertainty, 22: 207–226.Google Scholar
McCollister, Kathryn E., French, Michael T., and Fang, Hai. 2010. “The Cost of Crime to Society: New Crime-Specific Estimates for Policy and Program Evaluation.” Drug and Alcohol Dependence, 108(1–2): 98–109.Google Scholar
Mc Fadden, Daniel. 1975. The Measurement of Urban Travel Demand. University of California, Berkeley, CA.Google Scholar
Meyer, Ruth K., and Nachtsheim, Christopher J.. 1995. “The Coordinate-Exchange Algorithm for Constructing Exact Optimal Experimental Designs.” Technometrics, 37: 60–69.Google Scholar
Mishan, Edward J. 1971. Cost–Benefit Analysis. An Introduction. New York, NY: Praeger.Google Scholar
Moreno, Carolina, and Salvia, Agustín, 2012. Vulnerabilidad al delito y sentimiento de inseguridad en las grandes áreas urbanas de la Argentina. Universidad Católica Argentina. Available at: http://wadmin.uca.edu.ar/public/20180427/1524854330_Boletin_inseguridad_2012_21-12.pdf (accessed April 1, 2019).Google Scholar
Mushkin, Selma J., and Collings, Francis d'A., 1959. “Economic Costs of Disease and Injury.” Public Health Reports 74: 795–809.Google Scholar
Nagin, Daniel S., Piquero, Alex R., Scott, Elizabeth S., and Steinberg, Laurence. 2006. “Public Preferences for Rehabilitation Versus Incarceration of Juvenile Offenders: Evidence from a Contingent Valuation Survey.” Criminology and Public Policy, 5: 301−326.Google Scholar
Narain, Urvashi, and Sall, Chris. 2016. Methodology for Valuing the Health Impacts of Air Pollution: Discussion of Challenges and Proposed Solutions. Washington, D.C.: World Bank Group.Google Scholar
OECD, 2012. Mortality Risk Valuation in Environment, Health and Transport Policies. Paris: OECD Publishing.Google Scholar
Picasso, Emilio, and Cohen, Mark A.. 2019. “Valuing the Public’s Demand for Crime Prevention Programs: A Discrete Choice Experiment.” Journal of Experimental Criminology. forthcoming.Google Scholar
Piquero, Nicole Leeper, Cohen, Mark A., and Piquero, Alex R.. 2010. “How Much is the Public Willing to Pay to be Protected from Identity Theft?.” Justice Quarterly, 28(3): 437–458.Google Scholar
Pope, Devin G., and Pope, Jaren C.. 2012. “Crime and Property Values: Evidence from the 1990s Crime Drop.” Regional Science and Urban Economics, 42(1–2): 177–188.Google Scholar
Rizzi, Luis I., and Ortuzar, Juan de Dios. 2003. “Stated Preference in the Valuation of Interurban Road Safety.” Accident Analysis and Prevention, 35: 9–22.Google Scholar
Robinson, Lisa. A.. 2017. “Estimating the Values of Mortality Risk Reductions in Low- and Middle-Income Countries.” Journal of Benefit-Cost Analysis, 8(2): 205–214.Google Scholar
Rosen, Sherwin. 1974. “Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition.” Journal of Political Economy, 82(1): 34–55.Google Scholar
Rosen, Sherwin. 1983. The Equilibrium Approach to Labor Markets. National Bureau of Economic Research, NBER Working Paper No. 1165.Google Scholar
Saelensminde, Kjartan. 2003. “Embedding Effects in Valuation of Non-market Goods.” Transport Policy, 10: 59–72.Google Scholar
SAIMO. 2015. Sociedad Argentina de Investigadores de Marketing y Opinión. El nivel socioeconómico en Argentina. Available at: http://www.saimo.org.ar/observatorios/observatorio-social (accessed April 1, 2019).Google Scholar
Schargrodsky, Ernesto, and Di Tella, Rafael. 2013. “Informe del Laboratorio de investigaciones sobre crimen, instituciones y políticas.” Report by Laboratorio de investigaciones sobre crimen, instituciones y politicas, Universidad Torcuato Di Tella, Buenos Aires, Argentina.Google Scholar
Schelling, Thomas C. 1968. “The Life You Save May Be Your Own.” Problems in Public Expenditure Analysis, 127: 129–130.Google Scholar
Thaler, Richard. 1978. “A Note on the Value of Crime Control: Evidence from the Property Market.” Journal of Urban Economics, 5(1): 137–145.Google Scholar
Train, Kenneth. 2009. Discrete Choice Methods with Simulation. New York: Cambridge University Press.Google Scholar
Triandis, Harry, and Gelfand, Michele. 1998. “Converging Measurement of Horizontal and Vertical Individualism and Collectivism.” Journal of Personality and Social Psychology, 74: 118–128.Google Scholar
Tversky, Amos, and Kahneman, Daniel. 1986. “Rational Choice and the Framing of Decisions.” Journal of Business, 59(4.2): S251–S278.Google Scholar
United Nations Development Program. 2013. Informe regional de desarrollo humano. Seguridad ciudadana. Available at: https://www.undp.org/content/dam/rblac/img/IDH/IDH-AL Informe completo.pdf.Google Scholar
Viscusi, W. Kip. 1978. “Labor Market Valuations of Life and Limb: Empirical Evidence and Policy Implications.” Public Policy, 26(3): 359–386.Google Scholar
Viscusi, W. Kip, and Aldy, Joseph E.. 2003. “The Value of a Statistical Life: A Critical Review of Market Estimates Throughout the World.” Journal of Risk and Uncertainty , 27(1): 5–76.Google Scholar
Viscusi, W. Kip, and Masterman, Clayton J.. 2017. “Income Elasticities and Global Values of a Statistical Life.” Journal of Benefit-Cost Analysis, 8(2): 226–250.Google Scholar
Wickramasekera, Nyantara, Wright, Judy, Elsey, Helen, Murray, Jenni, and Tubeuf, Sandy. 2015. “Cost of Crime: A Systematic Review.” Journal of Criminal Justice, 43(3): 218–228.Google Scholar
World Bank and IHME (Institute for Health Metrics and Evaluation). 2016. The Cost of Air Pollution: Strengthening the Economic Case for Action. Washington, D.C.: World Bank.Google Scholar
Zarkin, Gary A., Cates, Sheryl C., and Bala, Mohan V.. 2000. “Estimating the Willingness to Pay for Drug Abuse Treatment: A Pilot Study.” Journal of Substance Abuse Treatment, 18: 149–159.Google Scholar
Supplementary material: PDF

Picasso and Grand supplementary material

Picasso and Grand supplementary material 1

Download Picasso and Grand supplementary material(PDF)
PDF 346.4 KB
Supplementary material: PDF

Picasso and Grand supplementary material

Picasso and Grand supplementary material 2

Download Picasso and Grand supplementary material(PDF)
PDF 105.5 KB