In its 2023 revision of the social cost of carbon, the U.S. Environmental Protection Agency values people’s lives on the basis of their willingness to pay for them, without applying any distributional weights. It justifies this proposal on grounds of the Kaldor–Hicks criterion, which avoids interpersonal comparisons of wellbeing. But this criterion was discredited 70 years ago. Interpersonal comparisons of wellbeing cannot truly be avoided, and they should be used to determine distributional weights. One way of doing so is to identify as a numeraire a good that brings equal wellbeing to each person. A healthy life year is a reasonable, though only approximate, candidate for such a good. This article presents the point of view of a philosopher, regarding the practice of economists from outside the discipline.

Compromised kidney function is associated with an array of environmental contaminants and pathogens that may be considered for regulation. However, there are few valuation estimates for kidney effects for use in benefit–cost analyses, particularly willingness-to-pay estimates. This paper is one of several surveys valuing morbidity developed by the OECD Surveys to elicit Willingness-to-pay to Avoid Chemicals-related negative Health Effects project, which aims to improve the basis for benefit–cost analyses. We report the results of a stated preference survey valuing reduced the risk of symptomatic chronic kidney disease, filling an important gap in the valuation literature and addressing a need for applied benefits analysis of chemical regulation. The survey was administered to representative samples in each of 10 countries: Canada, Chile, China, Denmark, Germany, Italy, Norway, Türkiye, the United Kingdom, and the United States. The mean (median) WTP for an average reduction of 3.5 in 1,000 of the risk of serious kidney disease over 5 years is $2,609 ($764), corresponding to a mean (median) value per statistical case (VSC) of chronic kidney disease of $805,000 ($224,000). The mean VSC varies between $700,000 for Canada and $1,200,000 for Türkiye.

Patient navigation (PN) is increasingly used to help people overcome barriers to accessing health care. In a recent trial, PN was added to motivational interviewing (MI) to help patients discharged from detoxification (detox) transition to follow-up care. The goal was to test whether PN in addition to MI increased transition rates and reduced subsequent readmissions into detox compared with MI alone. Results demonstrated little evidence of a treatment effect on either of these two outcomes, but post hoc exploratory analyses showed that patients who received PN were less likely to be arrested in the year following discharge than patients who did not receive PN. In addition, the group that received PN had fewer multiple arrests resulting in a lower average number of arrests per person. These findings are hypothesis-generating and need replication for conclusive inference. Nevertheless, economic analysis indicates that PN after detox could be a cost-beneficial intervention to reduce arrests among a population at high risk for involvement in the criminal justice system.

Mask mandates were controversial policies during the pandemic. Although there is considerable research on the benefits of masks, there has been no research on the distribution of perceived costs of compliance with mask mandates. This article presents the results from a hypothetical set of questions related to mask-wearing behavior and opinions that were asked of a nationally representative sample of over 4,000 participants in early 2022. We use survey valuation methods to assess how much participants would be willing to pay to be exempted from rules of mandatory community masking. The survey asks specifically about a 3-month exemption. We find that the majority of respondents (56%) are not willing to pay to be exempted from mandatory masking. However, the average person was willing to pay $525, and a small segment of the population (0.9%) stated they were willing to pay over $5,000 to be exempted from the mandate. Younger respondents stated higher willingness to pay to avoid the mandate than older respondents. Combining our results with standard measures of the value of a statistical life, we estimate that a 3-month masking order was perceived as cost-effective through willingness to pay questions only if at least 13,333 lives were saved by the policy.

Estimating value of statistical life (VSL) is an important input to many benefit-cost analysis (BCA) approaches, but for many low- and middle-income countries, there are limited or no data estimating VSL. Current guidance relies on extrapolation of results from high-income settings, which may be unreliable, leading to low confidence applying VSL. During 2019, we surveyed 1,820 low-income individuals (average consumption per capita USD329) across four diverse regions in Ghana and Kenya, to inform recommendations about effective spending in the development sector. We elicited VSL using a stated-preference approach, capturing the willingness-to-pay to reduce the risk of death for themselves and their children. Additionally, we conducted multiple “policy choice experiments” (PCEs) in which we asked respondents to choose, from the perspective of a decision-maker, between programs that save lives of different ages, and save lives and provide cash transfers. VSL estimates for this population fell in the range of USD66,795–USD90,453 (PPP-adjusted). We found similar results in the PCE but uncovered much stronger preferences for saving younger lives. Overall, our results suggest that VSL in low-income countries may be higher than estimates based on extrapolations from wealthy countries and that within these communities, policymakers should place more weight on saving the lives of young children. We also explore methodological learnings about how to apply and collect data for BCA in particularly low-income, low-education settings. We find that through careful training and gatekeeping, it is feasible to elicit complicated preferences in this population, and both approaches have their benefits and drawbacks.

President Biden’s first-day memo “Modernizing Regulatory Review” directs the Office of Management and Budget to “propose procedures that take into account the distributional consequences of regulations… to ensure that regulatory initiatives appropriately benefit and do not inappropriately burden disadvantaged, vulnerable, or marginalized communities.” This paper makes two contributions. First, it discusses how economic analysis can transparently provide the information needed to make value-judgments about what distributional effects are appropriate and inappropriate. Second, it discusses the distributional consequences of regulations that are either designed to reduce internalities or might have the additional benefit of reducing internalities. Examples include tobacco product regulations, appliance energy efficiency standards, and automobile fuel efficiency standards. In many cases, the regulations will increase the prices or decrease the availability of goods that disadvantaged consumers prefer. This paper discussed how to determine whether restricting their consumption opportunities creates net benefits or net costs for disadvantaged consumers. Inframarginal consumers who do not change their consumption face higher opportunity costs but do not receive any benefits from reduced internalities. Empirical challenges include the need to quantify the fraction of inframarginal consumers and the size of the internalities.

There is a need to value health technologies in a way that accommodates their broader economic impacts and competing approaches for doing so have emerged. The Pareto principle (PP) requires policymakers to resolve intrapersonal trade-offs by deferring to the preferences of the individuals facing those trade-offs. Many broad value frameworks such as cost-utility analysis and its extensions, health-centric multicriteria decision analysis, and poverty-free life expectancy are not sufficiently deferential to these preferences, violating PP. I propose using the health-augmented lifecycle model (HALM) to value health technologies in a way that flexibly incorporates the interactions among health and economic factors – specifically mortality and morbidity risks, paid and unpaid work, consumption, leisure, and public and private transfer inflows and outflows--over the life course. It relies on individual preferences, satisfying PP. It is compatible with cost-benefit analysis, social welfare functions, and equivalent income approaches. I calibrate the HALM for the US setting and apply it to a pediatric vaccine.

Public sector allocative decisions should reflect, as far as possible, the preferences of those affected by the decisions. Conventional benefit–cost analysis (BCA) will simply aggregate individuals’ private willingness-to-pay (WTP) over all affected individuals to estimate the total benefits of a policy that delivers a public good. Given the nature of a public good, it is not unreasonable to consider that an individual may have altruistic preferences over the consumption of the public good by others. In this paper, we set out the theoretical underpinnings for a new citizen-based WTP, informed by political philosophy. Our model extends the standard social utility model (Bergstrom, 2006) of WTP for a public good when individuals are altruists by incorporating a Veil of Ignorance (VoI; Harsanyi, 1955). Our findings show that our WTP (Citizen) correctly includes altruistic as well as distributional preferences of individuals in society into WTP for use in a BCA. When WTP (Citizen) are aggregated for use in a BCA, equal weight is given to each individual’s preference and the BCA will correctly identify potentially Pareto-improving projects in a consistent manner.

The considerable literature on the value of a statistical life (VSL) documents the wage-mortality risk trade-offs for the working population. Regulatory analyses often must monetize risks to populations at the tails of the age distribution. Because of the longer life expectancy for children, there have been proposals to add a premium to their VSL, which would generate an inconsistency with revealed preference estimates of the VSL trajectory over the life cycle. The shorter life expectancy among older people has led to various arbitrary senior discounts for seniors’ life expectancy. Application of the value of a statistical life year (VSLY) can address valuation of small changes in life expectancy. Examples of inappropriate age adjustments that we discuss include practices by the Consumer Product Safety Commission (CPSC) and the Environmental Protection Agency (EPA).

Animal welfare is often ignored in decision-making, despite widespread agreement about its importance. This is partly because of a lack of quantitative methods to assess the impacts of policies on humans and nonhumans alike on a common scale. At the same time, recent work in economics, philosophy, and animal welfare science has made progress on the fundamental theoretical challenge of estimating the well-being potential of different species on a single scale. By combining these estimates of each species’ well-being potential with assessments of how various policies impact the quality of life for these species, along with the number of animals affected, we can arrive at a framework for estimating the impact of policies on animal health and well-being. This framework allows for a quantifiable comparison between policies affecting humans and animals. For instance, it enables us to compare human QALYs to animal QALYs tailored to specific species. Hence, the intrinsic value of animal welfare impacts of policies can be monetized on the same scale as market and non-market impact for humans, facilitating benefit–cost analysis. Many challenges remain though, including issues of population ethics, political feasibility, and new complexities in addressing equity and uncertainty.