We report on the results of a survey based on conjoint choice experiments that was specifically designed to investigate the effect of context on the Value of a Statistical Life (VSL), an important input into the calculation of the mortality benefits of environmental policies that reduce premature mortality. We define “context” broadly to include i) the cause of death (respiratory illness, cancer, road traffic accident), ii) the beneficiary of the risk reduction (adult v. child), and iii) the mode of provision of the risk reduction (public program v. private good). The survey was conducted following similar protocols in Italy and the Czech Republic. When do not distinguish for the cause of death, child and adult VSL are not significantly different from one another in Italy, and the difference is weak in the Czech sample. When we distinguish for the cause of death, we find that child and adult VSLs are different at the 1% level for respiratory illnesses and road-traffic accidents, but do not differ for cancer risks. We find evidence of a “cancer premium” and a “public program premium.” In both countries, the marginal utility of income is about 20% lower among wealthier people, which makes the VSL about 20% higher among respondents with incomes above the sample average. The discount rate implicit in people‘s choices is effectively zero. We conclude that there is heterogeneity in the VSL, and that such heterogeneity is primarily driven by risk characteristics and mode of delivery of the risk reduction, rather than by individual characteristics of the respondent (e.g., income and education). For the most part, our results do not disagree with environmental policy analyses that use the same VSL for children and adults, and that apply a cancer premium.
This study investigates the relationship between wages and risks of work-related fatalities in the Czech labour market. To prove this relationship, we followed the theory of compensating wage differentials and the theory of hedonic prices. Using data from 2007 Czech labour survey, we econometrically derived three hedonic wage functions. To estimate mortality risks premiums, two of hedonic wage functions used objective measures of fatality risk, one subjectively perceived risk. We found a positive and statistically significant correlation between wages and occupational fatality risks in all three models. The estimated effect was lower for hedonic function with worker´s perception of mortality risks. This result implies the workers themselves underestimate the fatality risks that they are exposed. Based on estimated hedonic wage functions, we computed the value of a statistical life (VSL) which indicates the marginal rate of substitution between compensation and mortality risk. The implied value of VSL is 60 million CZK for the model with subjectively perceived risks and 266 million CZK for the models with objective risks in 2009 Czech crowns.
Monetary impacts of premature mortality due to heat waves Preferences for public programmes against spread of ticks due to climate change and a new vaccine against Lyme disease, prevalence of tick-borne diseases and exposure to ticks
How are different consumption activities structured within the Czech society, and what effects do they have on the environment? This new volume by Milan Scasny, Jan Urban and Iva Zverinova proposes examples of policy measures and tools aimed at reducing the adverse environmental effects of residential consumption behaviours.
Consumers preferences for sustainable and healthier lifestyle are examined through stated preference discrete choice experiments. Specifically, we introduce several choice situations in which each respondent was asked to choose the best from three lifestyles presented, including the respondent’s current lifestyle. Each lifestyle alternative is described by a different diet, health risks, and monetary costs. Diet is described by a number of portions of five different food items eaten per week (fruits and vegetables, meat, fish, legumes, and confectionery, ice-cream and sugar-sweetened drinks). Using a split-sample treatment, lifestyles are then described by either physical activities or environmental impacts (in kg of CO2 emissions). We also examine the effect of self-affirmation and information about the environmental impacts provided separately or in a combination. A non-linear preference is tested for increasing versus decreasing cost of food expenditures. Preferences are analysed using an original stated preference survey conducted in five EU countries (the Czech Republic, Latvia, Portugal, Spain, and in the United Kingdom) in summer 2018, with dataset consisting of 10,288 observations. We find that importance of lifestyle attributes varies across the countries and information treatments. The cost is significant in every country, indicating that lower costs lead to a higher probability of choosing the alternative lifestyle. Reducing health risks and environmental impact motivated respondents to change their lifestyle, even though reducing 1 kg CO2 due to food consumption a week is valued 3–6 times less than reducing cardiovascular risk by one percent. Still, the implied WTP for a tone CO2 abatement is in a range of 300–1,200 Euro and VSC of cardiovascular disease lies between 4,000 and 35,000 Euro, depending on country and DCE variant. Increasing physical activity increases the likelihood of changing lifestyle only in Latvia and Portugal. Most respondents prefer to keep eating meat and eliminating meat or fish from food consumption is associated with large dis-benefit. Respondents also prefer to increase portions of health-improving vegetables and fruits, however, this is not the case of pulses.
Large but temporary price increases are sometimes deployed on days when the demand for electricity is extremely high due to exceptionally warm or cold weather. But what happens when the extreme price changes are permanent? Between January 2013 and April 2016, natural gas and electricity prices in Ukraine increased dramatically (up to 300% of the initial rates). We exploit variation in tariffs over time and across customers to estimate the price elasticity of electricity demand using a panel dataset with monthly meter readings from households in the city of Uzhhorod in Ukraine. We ask three research questions. First, what is the price elasticity of consumption implicit in the response (if any) to these large electricity price changes? Second, is there evidence of heterogeneity in the price elasticity of electricity demand driven by dwelling or household characteristics, or by consumer understanding of block pricing and/or own consumption levels? Third, how quickly do household adjust their consumption after a price change?