although researchers may find ways to address the issues with further development of the revealed-preference approach.
A fundamental need is to understand better how age and remaining life expectancy affect WTP for reductions in mortality risks or increases in life expectancy. One step would be to ask that future (or even previous) studies report total age effects—that is, WTP by age cohort—in addition to marginal effects of age on WTP. Given the correlation of age with some of the other factors, there may be less uncertainty in the estimates of a total age effect. However, age-related income differences, sex differences, health differences, and the like would then be embedded in the estimates, and it might not be appropriate to use different VSLs that have these effects embedded.
Several recent studies (e.g., Alberini et al. 2004) have looked qualitatively or quantitatively across the valuation literature to assess age and other effects. The assessments have been hampered by issues in the reporting of information and the lack of availability of the datasets produced. Future research funded by EPA should urge that its datasets be made available for meta-analysis.
More fundamental research is needed to explore and develop methods for communicating and valuing changes in mortality risk that reflect the full life cycle. Studies to date have focused on WTP for annual changes in mortality risk, but the risk change of interest in most pollution-control assessments is more comprehensively described as a shift in the survival curves, which are plots of survival probability in all future periods and from which life expectancy is derived. That poses a challenge for stated-preference studies. A few studies have used changes in life expectancy to define mortality-risk change (e.g., Johannesson and Johansson 1996; Morris and Hammitt 2001), but many respondents seem to dismiss these changes as time added at the end of life, when quality of life may be substantially reduced. DeShazo and Cameron (2004) included multiple periods in their presentation of risk changes in an ambitious and innovative stated-preference study; analysis of their results has not yet been published.
It is also important to learn more about how mortality-risk characteristics affect the valuation of reducing risk. Environmental-benefits assessments have relied primarily on estimates of WTP to reduce risk of accidental death to estimate values for reducing risk of illness-related death. A few studies have compared values of WTP (or nonmonetary preferences) to reduce risk in different contexts (e.g., Magat et al. 1996; DeShazo and Cameron 2004), and more studies along these lines are needed.
Studies in a public-goods context that can isolate the effect of the age of those who benefited on the WTP of respondents for programs that reduce mortality risk in the community might help to resolve this issue as well. But in addition to such studies, we would need approaches to distinguish paternalistic from non-paternalistic altruism (as defined in Jones-Lee 1991) if double-counting of benefits is to be avoided. Conceptual analysis would be needed to understand how such results might be appropriately used in cost-benefit analysis, in which the usual paradigm is to sum private WTPs of the beneficiaries.