What is the Value of a Statistical Life?
In economic terms the Value of a Statistical Life (VSL) is the amount of money a person (or society) is willing to spend to save a life. Since there is no formal market for lives, the only way to measure the VSL is through indirect methods (e.g., surveys or observed human behavior in risky environments). Why study the VSL? Understanding the value of life is important for government policies where citizens’ lives are at risk or where the goal is to save lives. For example, if pollution abatement measures come at a societal “cost per life saved” does the societal benefit of saving a life exceed this cost? If there are costs and benefits associated with going to war, how does society value the potential loss of life? In fact, the U.S. Environmental Protect Agency and the U.S. Office of Management & Budget have specific guidelines for the VSL. Presidential VSL letter Report to congress Controversies The act of placing a dollar value on human life is bound to stir up ethical, religious and
