Are Some Lives More Valuable?
A theoretical model of the ethical preferences of individuals is tested by conducting a choice experiment on safety-enhancing road investments. The relative value of a saved life is found to decrease with age, such that the present value of a saved year of life is almost independent of age at a pure rate of time preference of a few percent, and a saved car driver is valued 17-31% lower than a pedestrian of the same age. Moreover, individuals’ ethical preferences seem to be fairly homogenous.
Göteborg University. School of Business, Economics and Law
Ethics; social preferences; individual social welfare function; relative value of life; random ethical model
Working Papers in Economics, nr 96